Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

Oral Answers to Questions — SCOTLAND

Constitutional Convention

Mr. Home Robertson: To ask the Secretary of State for Scotland if the Government will now give further consideration to participating in the Scottish constitutional convention.

The Secretary of State for Scotland (Mr. Malcolm Rifkind): No, Sir.

Mr. Home Robertson: I see that a certain loyal junior Minister has been trying to use the constitutional debate as an alibi for the latest of the Government's economic failures in Scotland. Does the Secretary of State accept that the Scottish constitutional convention is expressing the positive aspirations of the people of Scotland in a way in which this minority Administration never can and never will? Can we have a bit less of the Secretary of State's ministerial whingeing and will he face up to the clear demand from the people of Scotland for home rule within the United Kingdom?

Mr. Rifkind: The so-called constitutional convention is not having quite the major impact on Scottish opinion that the hon. Gentleman would like to believe. I understand that during the recent Scottish quiz "Super Scot", when the contestants were asked who were the two leaders of the convention, one participant responded that they were my hon. Friends the Member for Edinburgh, West (Lord James Douglas-Hamilton) and for Stirling (Mr. Forsyth). That suggests that the impact is not of the order that the hon. Gentleman would like.

Mr. Bill Walker: Is not the structure of the Scottish constitutional convention such that there is no way in which it can arrive at anything other than the answers that were required by those setting it up? In other words, it was never an attempt to have open discussion on the future of government in Scotland, but was for one, narrow, particular and nationalist issue only.

Mr. Rifkind: My hon. Friend is correct. It is now evident that the so-called convention is not making an impact on Scottish opinion, and that is not surprising because it is essentially an organisation entirely dominated by the Labour party, with different hats—those of the parliamentary Labour party, the Scottish Trades Union Congress, the Convention of Scottish Local Authorities or

a number of other individuals whose Labour sympathies are well known. Therefore, it is not surprising that they should reach a measure of agreement.

Mrs. Ray Michie: We should pursue this point. Is it riot the case that the Secretary of State and now the deputy Prime Minister both believe that the Tory party and the Government should listen to what people are saying? Will the Secretary of State now listen to what the majority of the Scottish people say about their wish to look after their own affairs—a fundamental right which should not be denied to the Scottish nation by any so-called democratic Government?

Mr. Rifkind: I am surprised that the hon. Lady wishes to give the impression that she is a great enthusiast for the convention, because her party has made it clear that it will have no truck with the convention unless it agrees to proportional representation for a future Scottish assembly. The deputy leader of the Labour party described proportional representation, on only 5 October this year, as being a reduction, not an extension, of democracy. He said that proportional representation would provide unrepresentative, small centre parties with disproportionate power, which would give them the opportunity to play cuckoos in the nest of the Labour Government. I know that the hon. Lady might wish to present herself as a flowering contribution to parliamentary debate, but there is little prospect of the convention meeting her party's fundamental requirement in respect of this matter.

Mr. Andy Stewart: Would my right hon. Friend care to comment on the suggestions made by Jim Ross, the secretary of the campaign for a Scottish assembly on the fact that it would levy all the taxes set by Westminster and pass the remainder over? What effect would this have on public expenditure in Scotland?

Mr. Rifkind: That was an extraordinary proposal because it implied that the assembly, despite all the protestations to the contrary, would have no tax-raising power of its own but would depend entirely on the block grant system. The hon. Member for Glasgow, Garscadden (Mr. Dewar), the shadow Secretary of State for Scotland, will be well aware, even if some of his hon. Friends are not, that one could not fund the sort of expenditure that he and his hon. Friends have advocated as necessary in Scotland through such a system. Only by additional tax-raising powers could the assembly fund such expenditure. Therefore, these proposals would be crucially debilitating to Scottish health, education and housing and to the whole Scottish programme.

Mr. Dewar: Is there not a strong case for the sort of reform that the convention is considering? The hon. Member for Stirling (Mr. Forsyth), an Under-Secretary of State for Scotland, has attempted to suggest that the Intel Corporation's decision to go to Ireland was based on the fear of constitutional change in Scotland. Did the Secretary of State hear the interview on Radio Scotland in which the chairman of the Russell Corporation, an American company which is coming to Scotland—which we welcome—dismissed that outlandish theory?
Is there not a case for constitutional change? Was it not indefensible for the Under-Secretary of State to take such a line and, in effect, to impugn Scotland's attractions as a home for inward investment, even when the Intel Corporation specifically repudiated what he had said? Will


the Secretary of State ensure that in future his colleague does not again put his partisan responsibilities as chairman of the Scottish Conservative party above his ministerial duty? Better still, will he remove him from one of his posts, given his apparent inability to distinguish between his two roles?

Mr. Rifkind: Unlike the hon. Gentleman, I have taken the trouble to read what my hon. Friend the Member for Stirling (Mr. Forsyth) said about the matter. The hon. Gentleman, uncharacteristically, has shown extraordinary negligence in making such public allegations. My hon. Friend did not say that Intel would not come to Scotland for the reason that the hon. Gentleman suggested. He said:
Southern Ireland, with its low rate of corporation tax does offer an attractive long term, low-tax investment environment. After a decade of Conservative tax cutting budgets, we can match that attraction. In Scotland, however, we suffer the ever present threat of the creation of a high spending and high taxing Scottish Assembly.
That is not only my hon. Friend's view and it is not only my view. It is the view of many within the Scottish business community. The hon. Gentleman should recall the conclusion of the report in the Scottish Business Insider, which was that Opposition parties have to convince indigenous companies of their financial reasoning and find an effective method of conveying the same message to potential inward investors. So far—[Interruption.]

Mr. Speaker: Order. I hope that we shall have briefer questions leading to shorter answers. We have spent a long time on Question No. 1.

Geriatric Hospital, Rutherglen

Mr. McAvoy: To ask the Secretary of State for Scotland if he will instruct Greater Glasgow health board to proceed with the original proposal to build a geriatric hospital in Rutherglen, owned, staffed and managed within the National Health Service.

The Under-Secretary of State for Scotland (Mr. Michael Forsyth): No. The Greater Glasgow health board's plans to work in partnership with the private sector could result in a brand new geriatric hospital for Rutherglen in only 18 months and at no capital cost to the board. I regret that the hon. Gentleman does not feel able to support the speedy provision of modern facilities for the elderly in his constituency.

Mr. McAvoy: I thank the Minister for his answer. I know that he gave it with all the authority of a man who knows that he is the real boss in the Scottish Office. Is the hon. Gentleman aware that we in Cambuslang and Rutherglen hold him personally responsible for blocking the plans for a National Health Service geriatric hospital in Rutherglen and replacing them with facilities provided by Takare plc? The health board says that it does not have the capital to build an NHS hospital but it says that if Takare goes bust it will find the capital to buy the facility from it. Will the Minister explain why the board has the capital to pay Takare but is unable to build an NHS hospital?

Mr. Forsyth: It is not true that the Greater Glasgow health board does not have sufficient capital. Its capital allocation this year is—I speak from memory—about £28 million. The board wishes to ensure that its resources go as far as possible to provide the greatest possible standard of

care. If it is possible to get a hospital built in the hon. Gentleman's constituency more quickly at no capital cost, that capital will be available for facilities elsewhere. The hon. Gentleman is putting his dogma before the interests of patients.

Development Agency

Mr. Foulkes: To ask the Secretary of State for Scotland when he last met the chairman of the Scottish Development Agency; and what issues were discussed.

The Minister of State, Scottish Office (Mr. Ian Lang): My right hon. and learned Friend met the chairman and the agency board on 22 May and discussed a range of issues of mutual interest.

Mr. Foulkes: Is the Minister aware of the surprise and dismay throughout Scotland at his unprecedented attack on the staff of the Scottish Development Agency? Is he further aware, as I am from my discussions with the chairman of the SDA, that the agency faces two real problems—first, the feeling of total uncertainty because of the Government's uncertainty about Scottish Enterprise, and secondly, the lack of funds to meet the commitments, need and demand throughout the country as identified by the officers of the agency? Both those problems lie at the door of the Secretary of State and the Government, and not with the staff or the SDA board.

Mr. Lang: I am surprised and dismayed that the hon. Gentleman should think that I had launched an attack on the chairman or the management of the SDA. I have done no such thing. The SDA's recommendations about Scottish Enterprise were largely in tune with the proposals that the Government have since brought forward. I would have thought that today, of all days, the hon. Gentleman might have found it in his heart to stand up and welcome the SDA's decision, announced only yesterday, to launch the Cumnock and Doon Valley initiative in his constituency, to which the agency is committing £9 million over the next five years. It is a useful economic regeneration and environmental measure that would be of great value to the hon. Gentleman's constituency.

Sir Hector Monro: Does my hon. Friend agree that the residents of Cumnock and Doon Valley are extremely fortunate in what the SDA has done? However, does he accept that there is some disquiet in Scotland about some financial arrangements between the SDA, local authorities and private industry which now seem to be in doubt? Can he assure me that those arrangements will be fulfilled in the current financial year?

Mr. Lang: My hon. Friend is absolutely right to suggest that there has been some concern about the funding of certain commitments by the agency. Indeed, I expressed that concern to senior agency personnel earlier this year. I am confident that, in the light of the decisions and steps that the agency has since taken, it has the matter under control. By proper prioritisation of the apportionment of funds, it should be able to meet its commitments.

Dr. Godman: At the meeting was there any discussion about the Inverclyde initiative? Is there not a great deal of concern that the Scottish Office intends to extinguish the initiative in March next year? Will the Minister assure me that the Inverclyde initiative will continue under the


umbrella of Scottish Enterprise? Does he not agree that it is an important local initiative which should continue beyond March 1990?

Mr. Lang: I am not aware of any proposal by the agency to discontinue the Inverclyde initiative. Inverclyde is certainly an area in need of specific help, which is why the agency launched the Inverclyde initiative. As the hon. Gentleman knows, we have also created the Inverclyde enterprise zone, which has a 10-year life span. The measures that we are taking are beginning to generate results, which is encouraging for the people of Inverclyde.

Mr. John Marshall: When my hon. Friend met the chairman of the SDA, did he discuss the fear of the Confederation of British Industry that devolution would lead to less investment in Scotland and therefore fewer jobs?

Mr. Lang: No, Sir, that was not an issue discussed at that meeting. However, we did discuss a number of issues, on which total agreement was reached about the beneficial effects of the Government's various economic policies on the Scottish economy.

Mr. Dewar: Is the Minister aware that the Opposition are astonished to hear him say that he has not criticised the top management of the SDA? Did he see the report in The Scotsman on 11 October, which quoted him as being
seriously concerned for some time about the way the SDA had been handling its budgets.
Did he see the further report that the SDA chairman, Sir David Nickson
protested bitterly to Ian Lang, the Scottish industry minister, about his public attack on the agency's chief executive.
Will that do anything for morale in the agency? Why did the Minister decide to air his views in such a public way rather than take his concerns to the agency on a private basis in the hope that something could be done if the criticisms were justified?
The Scotsman report specifically states that the Minister, in arguing for enterprise companies, did so in terms that implied that the case for them was his critical view of the SDA's financial performance and the need to remove most of the agency's projects and place them under the tighter financial control that should come with enterprise companies. Is that an accurate reflection of the Government's position?

Mr. Lang: I did not attack the SDA's chief executive, nor did its chairman protest bitterly to me. I expressed concern to the agency earlier this summer about the possible overcommitment of agency funds, and the hon. Gentleman would have been the first to criticise me if I had not done so. As a result of steps that the agency has taken, I have every confidence in its capacity to put its house in order and to administer its funds properly.
The agency and the Government are of one mind on the suitability of local enterprise companies within the Scottish enterprise proposals. The reference in the quotation from which the hon. Gentleman drew was to the fact that each local enterprise company will have its own budget within its own enterprise company area, which will lead to tighter control on a regional and local basis than has been exercised in the past under the overall umbrella of the agency's budget.

Trade Unions (Meetings)

Mr. Ron Brown: To ask the Secretary of State for Scotland how many official meetings he has had with trade union leaders since assuming his present office.

Mr. Rifkind: I meet representatives of the trade union movement from time to time on a range of issues. I am meeting the general council of the Scottish Trades Union Congress on 10 November to discuss matters affecting the Scottish economy.

Mr. Brown: Since some 8,000 or more jobs in Scotland are on the line simply because Ferranti is at risk from a takeover bid, is it not vital that the Secretary of State has a special meeting with the union leaders representing that company's workers? Will the Government act as guarantor for the company's independence and see off the predators? That is what the people of Scotland and my constituents in particular want.

Mr. Rifkind: I congratulate the hon. Gentleman on his reselection, which has given great pleasure to all Conservative Members.
I am conscious of the problems facing Ferranti, which is an exceptionally important company for Scotland and for Edinburgh in particular. The company has not asked the Government to act as a guarantor, nor would that be appropriate, as I am sure the hon. Gentleman knows. The Ministry of Defence put out a helpful statement showing the importance that it continues to attach to Ferranti and to its relationships with Ferranti and we look forward to the internal problems that that company has faced being resolved in the near future.

Mr. Kennedy: Has the Secretary of State had any communication with the management of Aberdeen Journals Ltd. on its dispute with members of the National Union of Journalists? Does he have any comment to pass on what appear to be the reasonable grounds that those NUJ members, both dismissed and still working, have for alleging apparent victimisation in the course of the dispute? Would not management be well advised to adopt a less intransigent attitude in the dispute and to agree to round table talks under the auspices of the Advisory. Conciliation and Arbitration Service, or some other suitable third party, to resolve this most unfortunate industrial dispute?

Mr. Rifkind: Naturally, we all regret industrial disputes, but it is not appropriate to expect Ministers to express any view on what is essentially a matter for management and unions to resolve. We hope that they will succeed in doing so, but no comment in this Chamber would be likely to help.

Mr. Canavan: Is the Secretary of State aware that some of Scotland's trade union leaders were in Falkirk yesterday for the counting of the votes of the Royal Scottish National hospital work force ballot on the hospital's management's proposals for the hospital to opt out of existing arrangements within the NHS? Since 95 per cent. of the work force gave a resounding vote of no confidence in the hospital management's proposals, will the Secretary of State instruct the Forth Valley health board and the hospital management to abandon the disastrous proposals which are an attack on the rights of the 800 mentally handicapped patients at the hospital?

Mr. Rifkind: I appreciate that the Labour party has been disappointed by the growing interest in various parts of Scotland in the opportunities for greater autonomy for hospitals and group practices. We are at an early stage in such matters, but the views of all concerned in the proposals will be of interest. At this stage we look forward to hearing from the various parts of Scotland interested in developing opportunities for greater autonomy for hospitals and group practices and the other opportunities outlined in our NHS proposals.

Electricity Prices

Mr. Darling: To ask the Secretary of State for Scotland what representations he has received in respect of electricity prices from industrial and consumer interests in Scotland.

Mr. Lang: My right hon. and learned Friend receives representations from time to time on a range of matters relating to electricity prices applying to industrial and domestic consumers in Scotland. The setting of electricity prices for all categories of consumers is, of course, the responsibility of the electricity boards.

Mr. Darling: Is the Minister aware that on top of the inevitable price rises that will follow the sell-off of the electricity industry, pensioners in particular are being hit by the very high level of standing charges imposed on electricity users? Will he join in the campaign to have those standing charges abolished by the private companies, and will he remind those speculators who clamour for an early sell-off of the industry that they will be seeking to profit from the financial misery suffered by old people who live in a country that has 50 per cent. over-capacity in electricity yet cannot afford to heat their homes in many instances?

Mr. Lang: As under the last Labour Government, standing charges are a matter for the electricity boards and not for the Government. I do not think that the Conservative party needs any lessons from the Opposition on prices, given that while electricity prices have fallen in real terms over the past seven years, under the last Labour Government they increased by 170 per cent. in cash terms and by 20 per cent. in real terms.

Mr. Buchanan-Smith: Will my hon. Friend acknow-ledge that the new arrangements for the industry offer a real opportunity for greater efficiency? Is he aware that those working in the industry want to get ahead with the new arrangements? When will the industry be floated?

Mr. Lang: I entirely agree with my right hon. Friend about the desirability of floating the industry and putting it into private hands. The timing is still to be decided, but the decision will be taken in the best interests of the industry, and it remains our firm intention to achieve privatisation within the lifetime of this Parliament.

Mr. Wilson: Does the Minister accept that the House was seriously misled by Ministers about the likely decommissioning costs of Magnox stations, including those of the one in my constituency, which are to be borne by the taxpayer in order to gild the unwanted privatisation lily? In the light of the leaked information that Magnox decommissioning is likely to cost £6·6 billion of taxpayers'

money, can he throw fresh light on the likely decommissioning costs at Hunterston A and under whose auspices they will be incurred?
Given the privatisation shambles, when will the Scottish boards be hawked in the market-place? Best of all, can the Minister assure us that that will not be done this side of a general election?

Mr. Lang: The hon. Gentleman would not expect me to comment on his leaked speculation, but I shall reassure him that I have no reason to believe that the House was misled over this matter.

Housing Investment

Mr. Sillars: To ask the Secretary of State for Scotland what representations he has received from the Convention of Scottish Local Authorities and individual local authorities about the case for increasing investment in public sector housing.

The Parliamentary Under-Secretary of State for Scotland (Lord James Douglas-Hamilton): At a meeting with me on 22 September, the convention expressed concern about a possible shortfall in receipts from council house sales in some authorities in the current year. I have also received representations from a number of local authorities concerning the detail of their ongoing programmes, but they mostly appreciate that consideration of future investment programmes can best take place in the context of their housing plans and capital programmes which they are due to submit next month.

Mr. Sillars: Does the Minister acknowledge that whatever he may be doing this year, the past 10 years have been years of disinvestment in public sector housing in Scotland, and that a reasonable measure of the success or otherwise of that policy is whether it puts decent roofs over families? Does he agree that after 10 years of that policy, 29,000 families are homeless, an increase of 77 per cent. in the past five years; that 192,000 people are on the waiting lists; that we have had a loss of stock of 130,000 homes in the public sector; and that some of our best councils are being turned into slum landlords because of a lack of investment in the public sector? How does he justify the bitter fruit of that policy?

Lord James Douglas-Hamilton: Total gross public investment in Scottish housing has increased in real terms by 2 per cent. a year over the past 10 years. The hon. Gentleman supported the last Labour Government in office and during those five years there was a decrease of 8 per cent. a year in real terms, for which he bore part of the responsibility.
Total gross capital spending in public sector housing in Scotland this year is £968·4 million, as allocated in March. I strongly recommend the hon. Gentleman to make representations about circumstances that affect his constituents to his district council, so that they can go into the housing plan on 3 November and be properly considered. This year, £94·2 million was allocated for investment in council houses in Glasgow, with a further £140 million in covenant schemes. No less than £466 million has been spent on Glasgow through housing associations, of course funded by the Government.

Mr. Nigel Griffiths: Will the Minister explain why he has not given local authorities separate and specific moneys to spend on dampness, when hundreds of thousands of Scots are living in homes riddled with damp?

Lord James Douglas-Hamilton: Certainly. Special allocations in recent years undoubtedly helped to focus local authority attention on the need to tackle such problems urgently, but this year those allocations were subsumed into general allocations, along with an extra £29 million, to make it easier for local authorities to tackle problems in the way that they considered most appropriate, and to leave the discretion to the local authorities to concentrate on their most pressing priorities.

Mr. Baldry: Is it not a constitutional convention in Scotland, as elsewhere in the country, that people should abide by the law passed by Parliament? How can those words possibly lie in the mouth of a representative of a party that has been exhorting people to break the law and not pay the community charge, thus denying local authorities much-needed funds to discharge their housing responsibilities?

Lord James Douglas-Hamilton: It is very important that local authorities should have the necessary funding from local taxation. I am very glad that the reminders being sent out are having an effect.

Mr. Galbraith: Does the Minister agree that so far the Government's response on dampness in housing has been totally ineffective? The Minister will by now have had the opportunity to read the report in the British Medical Journal of June this year which established in Scotland the relationship between damp housing and ill health. What is the Government's response to that report? When will the Government put in enough money to prevent damp housing and thus improve the health of the Scottish nation?

Lord James Douglas-Hamilton: The hon. Gentleman must appreciate that it is for local authorities to choose their top priorities. If dampness rather than homelessness or any other problem is the most pressing priority in his constituency, he should make absolutely certain that that is taken up by the local authority. Of course, I have read the report, which we discussed in the Scottish Grand Committee in the summer.

Farming

Sir Hector Monro: To ask the Secretary of State for Scotland when he last discussed with farming interests the sheep and beef sectors, with special reference to the hills and uplands; and if he will make a statement.

Mr. Rifkind: My right hon. Friend the Prime Minister and I met the president, council members and senior office bearers of the Scottish National Farmers Union on 7 September. We discussed a wide range of issues of current concern including the state of livestock farming in the hills and uplands.

Sir Hector Monro: Does my right hon. and learned Friend accept that there is grave concern within the National Farmers Union and farming circles that there might be a reduction in EEC funding of the hill livestock compensatory allowance? Does he further agree that in the

hills there really is no alternative to sheep and cattle production and that if the grant is reduced it will have serious repercussions on the rural economy?

Mr. Rifkind: I very much agree with my hon. Friend that the current proposal from the European Commission discriminates blatantly against the structure of hill farming in the United Kingdom, and we shall continue to oppose it in the negotiations in Brussels.

Mr. Maclennan: Does the Secretary of State recognise that measures to deal with budgetary problems in the CAP and structural surpluses are quite inappropriate if they remove from those in the hills and uplands their basic economy? Will he examine the possibility of strengthening measures for the regional development of those sparsely populated areas using agricultural techniques?

Mr. Rifkind: The hon. Gentleman will be the first to admit that structural surpluses are not healthy and need to be dealt with. I entirely endorse what the hon. Gentleman says about ensuring a system of support which recognises the particular nature of the agricultural economy in rural areas of Scotland. He will be aware that we have been successful in ensuring, through the Community, development programmes for the north of Scotland which have been widely welcomed and which are responsible for very important infrastructure improvements.

Mr. McAllion: Has the Secretary of State had discussions concerning another native species which is in great danger in Scotland? I refer, of course, to tigers, and in particular to the Tayside Tigers ice hockey team, so unjustifiably excluded from the premier league. Will the Minister join me in deploring that outrageous decision by the British Ice Hockey Association? Will he undertake to consult his colleagues about bringing pressure to bear on the association to reverse that decision?

Mr. Rifkind: This is not a matter which the Scottish National Farmers Union has yet thought appropriate to raise with me, but I assure the hon. Gentleman that my hon. Friend the relevant Minister will he looking into it.

Pittenweem Harbour

Mr. Menzies Campbell: To ask the Secretary of State for Scotland what is his policy towards the development of Pittenweem harbour; and if he will make a statement.

Mr. Lang: My right hon. and learned Friend recognises the importance of Pittenweem harbour for the local community. He has made a financial contribution towards an initial engineering survey, on the basis of which proposals have been drawn up for the harbour's development.

Mr. Campbell: When can we expect an unqualified endorsement by the Government of the proposals for Pittenweem? Is it a failure by the Government to understand the importance of the proposals for the fishing industry in north-east Fife, or perhaps is the truth that the Government are indifferent to the future of Pittenweem and the fishing industry? Is that why the Secretary of State declined to meet representatives of the fishing industry who wished to press the case for those developments?

Mr. Lang: My right hon. and learned Friend has made a financial contribution of £50,000 towards the initial engineering survey. Subject to the satisfactory completion of statutory procedures, he will be prepared to support the project in principle if benefits and a sound rate of return on the investment are likely to accrue. No decision can be announced until Fife regional council reconsiders the proposed development and submits a revised appraisal. The findings of the Parliamentary Commissioners will have to be taken into account, and their decision is expected towards the end of the year.

Mr. Buchanan-Smith: I acknowledge the importance of Pittenweem to the fishing industry in Fife, but will my hon. Friend say when the Secretary of State will make a statement on what he is doing about the parlous and critical state of the fishing industry in Scotland in relation to decommissioning, a reformed licensing system and plans for a much better and longer-lasting structure for the industry?

Mr. Lang: My noble Friend the Minister of State, Scottish Office is well seized of the urgency and importance of all the issues to which my right hon. Friend refers and will give them his close attention.

"Inside Intelligence"

Mr. Dalyell: To ask the Secretary of State for Scotland if he will make a statement on the implications for his general policy on initiating litigation of the cost of legal action relating to the book "Inside Intelligence".

Lord James Douglas-Hamilton: The costs payable by the Government in respect of the legal action relating to the book "Inside Intelligence" have not yet been finally determined. Cost is only one factor to be taken into account in deciding whether to initiate litigation.

Mr. Dalyell: What is the latest cost figure?

Lord James Douglas-Hamilton: The total amount to be paid will be ascertained only when accounts have been lodged and taxed by the relevant authorities. So far, the total sums paid by the Government amount to £64,871.

Mr. McKelvey: If the Minister is saying that cost is only one aspect of deciding whether a case should proceed, there must be some further examination of what the total cost will be. There must at least be a guesstimate of what the total cost will be.

Lord James Douglas-Hamilton: I have told the hon. Gentleman that the total sums paid so far amount to £64,871, but I stress that the issue in this case is whether a person who has undertaken not to write about his work with the intelligence services should be allowed to break that undertaking. It was, and remains, the Government's view that it is important to raise any court action necessary to prevent such undertakings from being broken.

Mr. Buchan: Does the Minister agree that this is the second time that the Government have made complete fools of themselves in the eyes of the world over such cases? Following Peter Wright, we now have the Cavendish case in Scotland. Is not the serious consequence of this that the Government can initiate such action, which

costs newspapers much money? For low-level circulation newspapers it is a form of concealed censorship, which should be deplored and withdrawn.

Lord James Douglas-Hamilton: I cannot agree with the hon. Gentleman. It is the Government's duty to enforce the duty of confidentiality owed by members or former members of the security and intelligence services. The articles in The Scotsman that prompted the action were based on a book written by such a person. The issue is whether a newspaper that had obtained that book was entitled to publish it. I stress that I cannot believe that the House would wish to abolish the duty of confidentiality owed by members of the security and intelligence services.

Mr. Dalyell: On a point of order, Mr. Speaker. In view of the unsatisfactory nature of that reply, I hope to raise the matter on the Adjournment.

Scottish CBI

Mr. Favell: To ask the Secretary of State for Scotland when he last had discussions with the Scottish Confederation of British Industry; and what matters were discussed.

Mr. Lang: My right hon. and learned Friend is in frequent touch with the Confederation of British Industry in Scotland on matters affecting the Scottish economy and industry. He looks forward to a continuing exchange of views.

Mr. Favell: With Scottish employment up, Scottish manufacturing output up and Scottish exports up, is it not clear to the Scottish CBI that free enterprise suits Scotland very well, just as it suits the rest of the United Kingdom very well? Is it not a fact that the Socialists on the Opposition Benches have been prophesying imminent disaster for Scotland for years, yet the opposite is the case? Would not the biggest disaster for Scotland be a Socialist assembly in Scotland?

Mr. Lang: My hon. Friend is absolutely right and has made the point extremely well. He was correct to put his finger on the point that a Socialist Government would be the most damaging thing from which the Scottish economy could suffer, bringing, as it would inevitably, high taxation.

Mr. Ernie Ross: What discussions has the Minister had with representatives of the Scottish CBI about the formation of enterprise companies to ensure that local authority representation is included in any companies that are established? Will he assure the House that representatives from district and regional local authorities will be included in the enterprise companies?

Mr. Lang: Many member of the CBI are taking a very active part in the formation of local enterprise companies. I cannot give the hon. Gentleman the assurance that he seeks about the representation of local authorities on local enterprise company boards because individuals will be appointed on their merits. However, the opportunity exists for local authorities to become closely involved—as many wish—with local enterprise companies through mem-bership of the companies.

Mr. Andrew Welsh: Will the Minister discuss with the CBI how the real economic needs of the Scottish people


can be met? What can the Minister say to one of my constituents who faces hard times because of the crisis in the fishing industry? The Government have not addressed that problem. My constituent is running a small business which is being hammered by a high interest rate policy designed to suit not Scotland, but the narrow selfish interests of the south-east of England. Is that not yet another example of a Scottish Minister who can do nothing being overruled by a British Minister who will do nothing for Scotland?

Mr. Lang: The hon. Gentleman seems to be remarkably unaware of the present circumstances of the economy in Scotland. Of course, there are issues of great concern to the fishing industry, which has experienced several very good years. My noble Friend the Minister responsible for fishing matters at the Scottish Office is giving those issues his very close and urgent attention.

Mr. Bill Walker: Does my hon. Friend agree that business decisions—as the CBI is well aware—are made on the basis of confidence in the future and that the flawed and probably fraudulent proposals for various forms of devolution, and the separatism on order from the nationalists, remind us of what happened in Quebec when capital flowed from that area at an alarming rate? We do not want that to happen in Scotland.

Mr. Lang: My hon. Friend is absolutely right. Confidence is critical to the success of an economy. The business community's confidence in this Conservative Government is reflected in the strong investment enjoyed by the Scottish economy in recent years.

Mr. Wallace: Has the Minister of State discussed with the Scottish CBI recently the proposals for electricity privatisation and in particular the implications for Scotland of announcements made by the Secretary of State for Energy during the recess which would appear to limit the scope of the Scottish boards to export surplus capacity to England? Will the additional costs arising as a result of that be borne by Scottish consumers, including industrial consumers, or by potential shareholders?

Mr. Lang: I am glad that the hon. Gentleman recognises the potential advantage to the privatised industry of increased competition through the sale of electricity down the interconnector to the markets in England. That matter is being examined closely by interested parties north and south of the border, and it would provide a considerable advantage to the Scottish consumer as well as to the electricity companies.

Mr. Harris: Will my hon. Friend confirm that employment in Scotland is at its highest level since 1980? Has my hon. Friend discussed with the CBI the possible effects of a tax-raising assembly on the Scottish economy and the employment prospects for Scotland?

Mr. Lang: I am happy to confirm that the civilian work force in employment in Scotland is at its highest level since 1980 and that, in recent months, almost all the indicators in the Scottish economy have been very encouraging. One thing that would certainly destroy confidence and, therefore, the success of the economy would be the increased tax burden that would flow from a Labour Government with all their high-spending policies and constitutional paraphernalia.

Mr. McLeish: Will the Minister explain to the chairman of the CBI in the next few weeks the thinking behind the recent very public attack on the integrity and competence of the chief executive of the Scottish Development Agency, Mr. Ian Robertson, in a Scottish newspaper? Does the Minister accept that such an assault will further damage the credibility of the SDA, which is already shaken by Government policy, and in which there is a real morale crisis because of the present membership of the Government Front Bench? More importantly, will the Minister tell the House that Mr. Ian Robertson's job is secure and that the Government have every confidence in his ability to carry out the future work of the SDA? Can we expect the exchange of correspondence between Sir David Nickson and the Minister to be made public at an early date so that we may see what is happening in what is fast becoming a very shabby affair in Scotland?

Mr. Lang: As the hon. Gentleman's question is founded on a myth, it hardly calls for an answer. The Scottish Development Agency is enthusiastically embracing the Government's plans for the development of Scottish Enterprise. It is the most exciting initiative to have been brought into the Scottish economic scene in many a year, and it will build on the success that we have already achieved in Scotland.

Smokeless Zones

Mr. Riddick: To ask the Secretary of State for Scotland when he expects smokeless zones to be extended to the whole of Scotland; and if he will make a statement.

Lord James Douglas-Hamilton: It is for a district or islands council to decide in the first instance whether to declare a smoke control area. That step is most unlikely for the many parts of Scotland which are sparsely populated.

Mr. Riddick: I welcome that reply because it will ensure that the inhabitants of the Western Isles and other parts of Scotland will be allowed to continue to burn peat as they have been doing for many years. Is my hon. Friend aware that my local council, Kirklees, intends to extend smokeless zones to cover rural areas in my constituency? That would stop the hearth-holders of the graveship of Holme burning peat as they have done for many centuries. Does my hon. Friend agree that that extension is a major intrusion into the lives of ordinary country folk?

Lord James Douglas-Hamilton: I am interested in what my hon. Friend says about West Yorkshire, but all areas in Britain must comply with the terms of the EC directive. In Scotland, apart from two districts in west central Scotland—Glasgow and Strathkelvin—the country meets the standards laid down by the EC directive on pollution by sulphur dioxide and suspended particulates. I stress that those two districts have received derogation until 1 April 1993 and that Scotland has made significant advances in that connection.

Mrs. Margaret Ewing: Although hon. Members welcome the sudden interest of the hon. Member for Colne Valley (Mr. Riddick) in the welfare of people in rural communities in Scotland, does the Minister agree that the burning environmental issue in sparsely populated areas is Nirex's proposal to use Scotland for the disposal of nuclear waste? Is he aware that his counterpart in the Department of the Environment has not yet been advised


by Nirex of the 12 additional sites in Scotland that are likely to be considered? Will the Scottish Office stand idly by and let Nirex use our country to dispose of its nuclear waste?

Lord James Douglas-Hamilton: No. Nirex is seeking to investigate the suitability of the geology at Sellafield and Dounreay. No decision can be taken until that has been done. Of course it is possible that neither site will prove suitable and that Nirex will require to reconsider site reselection, but I assure the hon. Lady that the facts in this issue will continually be made public.

Community Charge

Mr. Buchanan-Smith: To ask the Secretary of State for Scotland if he will remove from local authorities the discretion to vary the multiples for the setting of the standard community charge; and if he will make a statement.

Mr. Rifkind: The Government believe that the best course of action is the increased local authority discretion which I announced on 26 July. This has been widely welcomed.

Mr. Buchanan-Smith: Is my right hon. and learned Friend really confident? I do not share his confidence. Is he aware that some holiday home owners in my constituency do not have inside sanitation, electricity or water but have seen their rates increase from about £10 to more than £400? Local authorities have discretion to apply the standard charge at a lower level, but they are not doing so. Will my right hon. and learned Friend take more direct steps to ensure that the properties that I have described do not suffer from such treatment by local authorities?

Mr. Rifkind: Until the announcement in July, a local authority which wished to apply a single multiple would have had to do so in respect of all standard homes in its area. We have been informed by the Convention of Scottish Local Authorities that if local authorities had the discretion which, indeed, they will now have, to apply a single multiple to certain categories of second homes for the standard charge they would be inclined to use it. The convention has also given us an assurance that it intends strongly to recommend to local authorities that they use the discretion that has now been made available to them.

Mr. Douglas: Will the Secretary of State concede that in terms of the poll tax we are moving towards chaos in Scotland, not because of statements that he has made but because of statements that he has not made on matters such as Alzheimer's disease? A concession for those with Alzheimer's disease has now been made, although at the Dispatch Box the Secretary of State repeatedly refused to make concessions. On 26 July the Secretary of State made some statements about local authorities submitting bills for small sums to people who were dead and he seemed to suggest that those could be waived by local authorities. Would he care to clarify that because it needs urgent consideration in the whole of Scotland?

Mr. Rifkind: My hon. Friend the Minister of State made it clear before the House rose for the summer recess that we had every intention of helping those who have Alzheimer's disease. I am delighted that we have been able

to announce the way in which that will be done. I should have thought that the hon. Gentleman would have welcomed that rather than carp about it.
In reply to the other half of his question, my observation was that I believed it to be inconceivable that COSLA would seek to take action against a local authority that did not pursue a small sum due in respect of someone who had died. I hope that the position is now suitably clarified.

Mrs. Fyfe: How is it that the poll tax legislation, which went through the House of Commons first for Scotland and subsequently for England and Wales, was thought to be perfect beyond the bounds of any possible criticism, yet now hon. Members are beginning to discover some defects in it? Can it possibly be that Tory Members fear losing their seats at the next general election?

Mr. Rifkind: The hon. Lady is under a considerable misapprehension. The legislation approved by the House, both for Scotland and England, will be implemented. The changes announced recently were purely transitional arrangements—[Interruption.] Indeed, at the end of what will be a short transition the original proposals will come into effect in exactly the way that Parliament approved.

Mr. Jack: Does my right hon. and learned Friend agree that the Opposition's disinformation campaign on the community charge in Scotland has been unsuccessful? Can he confirm that already 83 per cent. of people are paying the community charge in Scotland?

Mr. Rifkind: Not only can I confirm that, but I can inform the House that the figure is as high as 95 per cent. in some parts of Scotland. Labour local authorities have themselves said that the level of payment to date is broadly comparable with that under the old rating system at this time of year.

Mr. Kirkwood: Is it not entirely disingenuous of the Secretary of State to blame local authorities for the financial adverse effects suffered as a result of these poll tax anomalies when local authorities have suffered substantial cuts in grants and would be penalised in some cases if they made available additional expenditure to cover such anomalies? When can we cross-examine the Secretary of State on the Floor of the House on the detail of his statement of 26 July? Has he had a chance to look at the new anomaly created by dragging the bed-and-breakfast operations into the rating system as a result of the standard community charge provisions?

Mr. Rifkind: The legislative requirements that flow from the recent announcement will be laid before the House at the earliest opportunity. It is extraordinary that, as a Member of Parliament from the borders area, the hon. Gentleman should not mention that under the new financing arrangements for local authorities, the local authorities in his part of Scotland will receive substantially greater grants than in the past and will do so under a system where grant penalties have been withdrawn. If the hon. Genteleman cannot express any welcome for that, it shows that he is a most ungrateful character.

Mr. Maxton: Although we welcome the long-delayed concession in the poll tax in relation to Alzheimer's disease, for which Opposition Members have fought long and hard, is it not shameful that in Scotland that concession will not be backdated to 1 April this year and


that the concession will be given to all Alzheimer's disease sufferers from the next financial year only? Is it not obvious from the concessions made at the Tory party conference in Blackpool last week that, as a result of the messages coming from Scotland about the gross unfairness of this tax and the bureaucratic mess surrounding it, the Tories in England are running scared about the effect that it will have on them at the next general election?

Mr. Rifkind: The chairman of the Alzheimers Disease Society warmly welcomed the Government's announce-ment when he met the Minister concerned. The main political change in Scotland since the introduction of the community charge has been that the Scottish Nationalists have fallen back to third place, which is where they belong.

Drinking Water

Mr. Dunnachie: To ask the Secretary of State for Scotland what proposals he has for increasing the level of funding to local authorities to met the European Economic Community requirements in relation to drinking water.

Lord James Douglas-Hamilton: Resources have been increased already. The 1989–90 capital allocation for water and sewerage services is £126 million, a 14 per cent. increase over the previous year's planned provision. Regional and islands authorities have been asked to provide details of costed action programmes to achieve full compliance with the EC drinking water directive. These will be taken into account when setting next year's allocations.

Mr. Dunnachie: In view of the promises made to the English water authorities that the standards of water in England will be raised to a standard acceptable to the EEC and that that will be funded by the Government, will the Minister give the same guarantees to Scotland, and if not, why not?

Lord James Douglas-Hamilton: Yes, indeed. Capital restructuring in England is necessary before privatisation. As the hon. Gentleman knows, arrangements in Scotland are different. The implications for Scottish consumers of the debt write-off and the cash injection for the new companies in England and Wales are now being considered.

Mr. Foulkes: Is the Minister aware that Mr. Greir, the director of sewerage for Strathclyde, has said that he is prepared to do everything necessary to clean up the Ayrshire beaches if the Government, and the Minister in particular, come up with the money? Will the Minister give an assurance that more money will be available? Incidentally, can he tell us how he and his colleagues have managed to get through the whole of this Question Time without the advice of their special adviser on Scotland, the hon. Member for Southend, East (Mr. Taylor)?

Lord James Douglas-Hamilton: I am grateful to my hon. Friend the Member for Southend, East (Mr. Taylor), with whom I share a secretary, for his constant advice. The hon. Gentleman's point will be seriously considered when the public expenditure survey is looked at this autumn.

Handicapped People

Mr. Nigel Griffiths: To ask the Secretary of State for Scotland what additional resources he is making available to health boards to ensure that the needs of handicapped people are provided for in the community.

Mr. Michael Forsyth: The bulk of services for handicapped people in the community is provided by local authorities. Between 1979 and 1989 provision in rate support grant for expenditure by social work departments was increased by 65 per cent. in real terms enabling authorities to make substantial increases in the level of those services.

Mr. Griffiths: Why have the Government done so little to consult those people involved in caring for people in the community? Why is the Government's response to the Griffiths report in Scotland already at the printers?

Mr. Forsyth: The hon. Gentleman is either misled or is misinforming the House. The Government have consulted carefully on Griffiths and allowed a substantial period for consultation before publishing the White Paper proposals, which we shall do shortly.

Industrial and Regional Policy

Mr. McFall: To ask the Secretary of State for Scotland when he last met interested bodies such as the Scottish Trades Union Congress and the Confederation of British Industry to discuss industrial and regional policy.

Mr. Lang: My right hon. and learned Friend is in frequent touch with bodies representative of industry in Scotland on matters concerning industrial and regional policy.

Mr. McFall: When the Minister last met those bodies, did he discuss the scurrilous remarks of the hon. Member for Stirling (Mr. Forsyth) about the Intel Corporation, which he said was chased away from Scotland by the prospect of high taxes from a Scottish assembly, a statement which was categorically rejected by the company, which said that the issue was never raised once? In any future meetings with those bodies, will the hon. Gentleman ensure the absence of the hon. Member for Stirling and make sure that he does what he has been good at: being the Paul Daniels of Scottish politics, making the Tory party, as well as the person of the Secretary of State for Scotland, disappear "Just like that", as the Prime Minister would say?

Mr. Lang: The hon. Gentleman has obviously spent most of the recess rehearsing that question. Sadly, it lacked accuracy as well as spontaneity. In my meetings and those of my right hon. and learned Friend with the CBI, one point that has been made abundantly clear is that it favours a low taxation economy. This Government have reduced corporation tax from 52p in the pound to 35p in the pound. Perhaps the Labour party will come clean one day and tell us how much corporation tax will rise under a future Labour Government.

Mr. Strang: To return to what the Secretary of State said about Ferranti, does the Minister recognise that it is not sufficient for the Government just to point to the statement from the Secretary of State for Defence—welcome though that was? We want an undertaking that


the Government will intervene, if necessary, to ensure that the financial solution found for Ferranti will provide for major increased investment in Scotland and will enable the company to go forward and win the contract for the European fighter aircraft.

Mr. Lang: We certainly recognise the great importance of Ferranti, as a major employer, to the Scottish economy. These are difficult and commercially sensitive matters. I can tell the hon. Gentleman that the Government are keeping in close touch with progress.

Mr. Donald Dewar: On a point of order, Mr. Speaker. May I ask for your advice on the increasing habit of questions being tabled and hon. Members not being here to ask them? The Minister of State said a few minutes ago that one of my hon. Friends had been rehearsing hard all recess. The new Patronage Secretary's representative on the Scottish team, the hon. Member for Darlington (Mr. Fallon), has been earning his corn. There are no fewer than nine questions down—seven from hon. Members south of the border—all in identical terms, showing a most unlikely interest in the views of the Scottish CBI. That may be fair game, but five of the questions from hon. Members south of the border

appeared in the first dozen or so called today. Only one of those hon. Members—the hon. Member for Pembroke (Mr. Bennett)—withdrew his question. There were four questions running from such unlikely places as Cannock and Burntwood, Amber Valley, Stockton, South and Beverley, for which the hon. Member concerned was not present. Does that not amount to an abuse and should not some guidance be given?

Mr. Speaker: Order. I sometimes hear complaints from the hon. Gentleman about the number of hon. Members representing English constituencies who put down questions. I do not quite get the thrust of the hon. Gentleman's argument this afternoon. These questions were put down before the recess. The hon. Members concerned notified my office and that is why their names were not called out.

Oral Answers to Questions — BILL PRESENTED

REFORM OF THE HOUSE OF LORDS

Mr. Allen presented a Bill to abolish the present composition of the House of Lords and to provide for a new membership based solely on an equal directly elected representation: And the same was read the First time; and ordered to be read a Second time tomorrow and to be printed. [Bill 204.]

Registered Homes (Rights to Residence)

Mr. David Hinchliffe: I beg to move,
That leave be given to bring in a Bill to provide for the residential security of persons living in voluntary, private residential or nursing homes and for connected purposes.
The proposed Bill aims to introduce a clear legal framework to protect the residential security of people admitted to private and voluntary homes. It seeks to place a statutory obligation on the proprietor or manager of a home to enter into a care contract with a resident prior to admission. The terms of the contract would be governed by regulations and include a requirement that residents being asked to leave the home must be given a specific period of notice. In addition to the resident being supplied with a copy of the contract, the Bill requires a copy to be supplied to the resident's nearest relative or representative and the local registration authority. They will also have to be notified formally if the home asks the resident to leave. The Bill would place a clear duty on the registration authority to ensure that—[Interruption.]

Mr. Speaker: Order. Will hon. Members please listen to what is being said on the ten-minute rule motion? It concerns an important matter.

Mr. Hinchliffe: The Bill would place a clear duty on the registration authority to ensure that, where necessary, the resident is given advice and assistance to obtain alternative accommodation.
Although paying residents possess certain common law rights of occupation, very few people in private or voluntary homes are made aware of their legal position. As a consequence, it is rare to hear of anyone challenging the legality of an attempt by an establishment to force that person to leave. The Bill aims to simplify the legal position and to ensure that residents of private and voluntary homes, who are often vulnerable and isolated people, cannot be forced to leave before appropriate alternative arrangements for their care have been made. The legal position of a resident in such a home appears markedly different from that of a person in private or local authority housing.
For many people it is clear that entering care significantly reduces or effectively ends the right to residential security that they previously enjoyed, and at a time in their lives when often they are least able to defend their interests. People directly affected by evictions from homes are rarely able to make a stand on the issue, and therefore the extent of the problem that the Bill addresses is difficult to assess because it is largely hidden.
I am particularly concerned that there are worrying examples of people being dumped by private homes. Some time ago I came across a case in my constituency where a private home admitted an elderly lady for a short stay while her family went away for a well-earned holiday. Within hours of her arrival the home determined that her

condition was such that it could not care for her. Rather than taking appropriate steps to arrange proper alternative accommodation, the home simply put her in a taxi and packed her off to the local police station.
Elsewhere in Yorkshire a local authority has recently had to threaten private homes with deregistration because of concern about the eviction of residents and the use of what is, effectively, emotional blackmail to pass responsibility for them on to relatives. A report to Sheffield's social services committee earlier this year described how one woman had been dumped at the out-patients department of the city's Royal Hallamshire hospital simply because she had become too difficult to handle. As the hospital's report confirms,
it is more common to hear of relatives being forced to make alternative arrangements for the care of a relative, often with little, if any, prior notice.
While a marked change in the condition of a resident may mean that in the resident's own interests, as well as those of the home, he or she needs more appropriate care, many evictions arise because of inadequate or non-existent assessment of the person's circumstances prior to admission.
Even more frequent are examples of people being forced to leave because of a reduction in their financial resources and their inability to meet the required fees with their retirement pension and an insufficient income support supplement. This point was raised by numerous hon. Members in yesterday's debate on community care and the Griffiths report. In these circumstances, people who do not have relatives who are prepared to top up their contributions—as many do nowadays—frequently move down market to cheaper and what must be described as less desirable conditions.
I hope that the care contract provided for in the Bill will improve the assessment process before admission and reduce the number of residents with inadequate financial resources who are admitted to care, only to be forced to leave subsequently when they are unable to pay their bills. The Bill addresses a problem facing some of our most vulnerable and dependent citizens. I am sure that, from their experience of cases in their constituencies, many hon. Members on both sides of the Chamber will see the logic behind the measure, and I hope that they will support its continued progress through Parliament.

Question put and agreed to.

Bill ordered to be brought in by Mr. David Hinchliffe, Mr. Tom Clarke, Mr. Geoffrey Lofthouse, Mrs. Alice Mahon, Mrs. Maria Fyfe, Mr. John Battle, Mr. Ian McCartney, Mr. Max Madden, Mr. Chris Mullin, Mr. Bob Cryer and Mr. David Blunkett.

REGISTERED HOMES (RIGHTS TO RESIDENCE)

Mr. David Hinchliffe accordingly presented a Bill to provide for the residential security of persons living in voluntary, private residential or nursing homes and for connected purposes: And the same was read the First time; and ordered to be read a Second time tomorrow and to be printed. [Bill 205.]

Defence Estimates

FIRST DAY'S DEBATE

[The following Reports from the Defence Committee are relevant: Second Report, Staffing Levels in the Procurement Executive, House of Commons Paper 269; Third Report, The Working of the AWACS Offset Agreement, House of Commons Paper 286; Fifth Report, The Progress of the Trident Programme, House of Commons Paper 374; Sixth Report, The Royal Navy's Surface Fleet: Current Issues, House of Commons Paper 419; Seventh Report, Decommissioning of Nuclear Submarines, House of Commons Paper 316; Eighth Report, The Procurement of the Tucano Trainer Aircraft, House of Commons Paper 372; Ninth Report, The Availability of Merchant Shipping for Defence Purposes: July 1989, House of Commons Paper 495; Tenth Report, The Vertical Launch Sea Wolf Missile System and the Type 23 Frigate Command System, House of Commons Paper 409; and Eleventh Report, The Procurement of the Light Anti-Tank Weapon LAW 80, House of Commons Paper 350]

Mr. Speaker: I have selected the amendment in the name of the Leader of the Opposition.

Several Hon. Members: rose——

Mr. Speaker: Order. A number of hon. Members who are now seeking to raise points of order also want to be called in the debate. I hope that they will not delay it.

Mr. Derek Conway: On a point of order, Mr. Speaker. I think it is appropriate to raise this with you now. You will know from past defence debates that in my constituency many factories produce defence procurement goods. I believe that some of the investment in those jobs is now under threat as a result of the confusion about the £5 million of proposed cuts in——

Mr. Speaker: Order.

Mr. Conway: If I can——

Mr. Speaker: No. I was hoping to call the hon. Gentleman. He could raise just such issues in his speech.

Mr. Conway: Further to that point of order, Mr. Speaker.

Mr. Speaker: Order. I call Mr. Heffer.

Mr. Eric Heffer: On a point of order, Mr. Speaker. Under no circumstances should we ever challenge your ruling, and of course I am not challenging your ruling, but may we have an explanation of why the amendment tabled by my right hon. Friend the Member for Chesterfield (Mr. Benn) and me, among others, which expresses the views of the conference of the Labour party, and is therefore a view held not just by the Labour party but by millions of people in this country, has not been called?

Mr. Allan Rogers: No, it is not.

Mr. Heffer: My hon. Friend the Member for Rhondda (Mr. Rogers) may not know because he has not been a Member long enough, but on many occasions in the past, I, my right hon. Friend the Member for Blaenau Gwent (Mr. Foot) and many others were called to speak when proposals of this kind were made. I would like to ask why—

Mr. Speaker: Order. The hon. Member has been here for a long time and he knows that it is not possible for the Chair to select more than one amendment. I have announced my decision about which amendment I will call today. Of course I will do my best to ensure that the hon. Member and his right hon. and hon. Friends who signed that amendment may take some part in this two-day debate.

Mr. Tony Baldry: Further to that point of order, Mr. Speaker. It is not for us to challenge your selection of amendments, but did you, Mr. Speaker, when you decided not to select the amendment in the name of the right hon. Member for Chesterfield (Mr. Benn), appreciate that it is exactly in line with Labour party policy at its conference? Is it not a great pity that Opposition Members will now be denied the opportunity of supporting their own policy?

Mr. Speaker: These are all points that could legitimately be raised in the debate. I call Mr. Secretary King.

Mr. Michael Brown: Further to that point of order, Mr. Speaker.

Mr. Speaker: As it was not a point of order, I think we should hear the Secretary of State.

Mr. Brown: It is a serious point of order, Mr. Speaker.

Mr. Speaker: I am not prepared to have a debate about my selection of amendments. I have already announced my selection, which is the amendment in the name of the Leader of the Opposition.

Mr. Brown: I have a point of order which is in no way connected with your selection, Mr. Speaker. I want to know, further to the legitimate point raised by the hon. Member for Liverpool, Walton (Mr. Heffer), whether it will be in order, if we catch your eye during the debate, to refer to and debate some aspects of the amendment in the name of the right hon. Member for Chesterfield (Mr. Benn). Although there are only 10 signatories here, there are another 4,201,000 out there who agree with what he has said.

Mr. Speaker: As I am sure that the House is anxious that we should get on, I can give the hon. Member a short answer. The answer is yes.

The Secretary of State for Defence (Mr. Tom King): I beg to move,
That this House approves the Statement on the Defence Estimates 1989 contained in Cm. 675.
When preparing for this debate, I took the opportunity to read the Hansard reports of last year's debate. There is a deadly similarity between the position in which we find ourselves now and what happened last year. Last year, I think it was the hon. Member for Liverpool, Walton (Mr. Heffer) who raised a point of order about whether it was in order for the official Labour party policy on defence, which was the subject of his amendment and that of certain of his hon. Friends, to be debated and not——

Mr. Allan Rogers: On a point of order, Mr. Speaker.

Mr. Speaker: Is it a point of order for me or a disagreement?

Mr. Rogers: It is a point of order, Mr. Speaker. Is it proper for the Secretary of State, after you have ruled that a previous intervention was not a point of order, to waste the time of the House by referring to that intervention?

Mr. Speaker: I was asked by the hon. Member for Brigg and Cleethorpes (Mr. Brown) whether it would be in order for these matters to be mentioned in the debate, and I gave the answer: it is in order.

Mr. King: If the hon. Member for Rhondda (Mr. Rogers) had done you the courtesy of listening to you, Mr. Speaker, he would have heard that it is in order to debate the amendment. Despite the sensitivity shown so quickly—we all understand why—by the hon. Gentleman, in a short while I shall have a little more to say about that amendment, which was carried with precisely twice the majority that the Leader of the Opposition could raise against the pathetic attempts of the official Opposition to prevent a vote on that amendment at the Labour party conference.
It is a privilege for me to speak for the first time as Secretary of State for Defence. I hope that I will carry the House with me when I pay a warm tribute to my predecessor, my right hon. Friend the Member for Ayr (Mr. Younger). Whatever people's political views, as both Secretary of State for Scotland and Secretary of State for Defence, there was no better liked Secretary of State, and I am proud to follow him in this office.
We are here to approve the "Statement on the Defence Estimates" and we have before us the report of the Select Committee on those estimates. Tagged with the estimates is a most impressive selection of reports of the Select Committee on a number of items that it has reviewed. I look forward to working closely with my hon. Friend the Member for Hampshire, East (Mr. Mates) and the right hon. and hon. Members who serve on the Committee. We have our different responsibilities, and I have no doubt that we shall have our disagreements as well, but I recognise that their responsibility, on behalf of the House of Commons, is to scrutinise the work of my Department. While we shall defend our interests vigorously, at all times we shall give prompt, courteous and, I hope, informative responses to any approaches that my hon. Friend and his colleagues may make to us.
I welcome the timing of this debate, immediately after the recess. Every hon. Member must share my feelings about the incredible nature of many of the events that have been taking place in the world, particularly in Europe, during this period. It is right that we should, at this early opportunity, have the chance to address, as the House of Commons, the important developments that are taking place in eastern Europe and the Soviet Union, and their implications for the defence of our country and for western defence.
During this time we shall need the fullest possible opportunity for consideration of, and informed discussion on, the issues that confront us. I have a specific announcement to make. It is vital that we have the resources that we need to address these issues and to get proper public understanding of them. To contribute to this, I have decided that the Ministry of Defence should help to establish a new centre for defence studies in Britain. A competition was held between universities, polytechnics

and other institutions to decide where it would be set up. The idea excited wide interest among them, and resulted in many attractive proposals. The final choice was a difficult and close one.
I can now announce that, subject to satisfactory negotiation of a detailed agreement, the centre will be set up at the university of London. This work will be strictly independent of the Government, and our hope is that, besides establishing a research reputation in its own right, the centre will act as a focal point to draw together and further stimulate the excellent thinking and research on the various aspects of defence issues taking place at other institutions.
Perhaps I should say something about the structure of the debate.

Sir Antony Buck: Before my right hon. Friend does that, will he tell us what the arrangements will be with existing institutions that deal with similar topics? I have in mind the independent institutions, the Royal United Services Institute and institutions of that character. Will we have further information from my right hon. Friend at an early date on these matters?

Mr. King: My hon. Friend's last sentence is the correct answer to his question. I wanted to make an announcement as soon as the decision had been made. There are valuable institutions working on different aspects, and it is felt that there is scope for a central body of the sort that I have described. It will not be working in competition with the various institutions. Instead, it will be engaged in bringing together, enlisting support and, on certain occasions, contracting out certain aspects of its work to other institutions. It will not be funded solely by the Government, but the Government will be making a significant contribution towards the costs of what will be independent activity.

Mr. Graham Riddick: Is my right hon. Friend aware that about nine months ago I visited the school of peace studies at Bradford university, and that it promised to send me any leaflets or literature that it produced setting out the multilateralist point of view as opposed to the unilateralist point of view? He will be interested to know that I have received nothing from the school of peace studies. Does he not think that that is disgraceful? May I suggest to him that the new body that he has announced will have to be much more objective than the Bradford peace group?

Mr. King: I hope that what my hon. Friend suggests will be achieved.

Mr. Tam Dalyell: What were the terms of reference given to Professor Lawrence Freedman, if it be him, and what is the financial arrangement?

Mr. King: The final terms have yet to be established. As I have said, the Government will make a worthwhile contribution towards the cost of the institution. I shall be happy to let the hon. Gentleman have at an early date the terms of reference that are applicable.
I shall say a few quick words about the structure of the debate, which is scheduled for today and tomorrow. This evening, my hon. Friend the Under-Secretary of State for Defence Procurement will, if he catches your eye, Mr. Deputy Speaker, be speaking about the areas of his


responsibilities. My hon. Friend the Minister of State for Defence Procurement will seek to catch your eye, Mr. Deputy Speaker, at the start of the debate tomorrow. The Minister of State for the Armed Forces will wind up the debate tomorrow. I shall concentrate mainly on the wider strategic issues. Ministers at the Ministry of Defence will be dealing with their specific areas of responsibility.
Within two days of taking over my new responsibilities I joined in welcoming the first official visitor to the Ministry of Defence. General Yazov was the first Soviet Defence Minister to visit the Ministry. Nothing could have focused my attention more clearly on the new situation that exists or on the new opportunities that exist for better understanding between our countries. I was pleased to receive an invitation from General Yazov to visit the Soviet Union, and I hope to do so in the coming year.
A more recent illustration of the increasingly close relationship and the development of better understanding between our countries was the meeting in West Germany last month between the C-in-C of BAOR and the C-in-C of RAF Germany with the C-in-C of the Soviet western group of forces. It was the first time since 1966 that the C-in-C of BAOR and the C-in-C of the Soviet western group of forces had met.
More recently I had an opportunity to visit Hungary. In addition to being shown something of Hungary's tank and helicopter forces, I had the opportunity at the military institute in Budapest to address 200 senior officers of the Hungarian armed forces.
These are all signs of what is now becoming possible and of the opportunities for closer contacts. We shall be seeking to develop such contacts between the United Kingdom and the Ministry of Defence with the Soviet Union and the Warsaw pact. There are further developments, with the continuation of the conventional forces in Europe negotiations in Vienna and the resumption of the START talks with the agreed objective of a 50 per cent. reduction in strategic nuclear weapons. As a result of the Wyoming meeting, there is agreement in principle on a chemical warfare convention with the aim of working towards a massive reduction of chemical weapons, and progressively their elimination.
All that points to a time of great optimism in relations between East and West. It is a time of hope in eastern Europe and the Soviet Union. I am sure that the whole House admires the courage and determination of President Gorbachev in what he is trying to do through perestroika and glasnost. During recent months there has been the change to a non-Communist Government in Poland and the removal of the iron curtain in Hungary with the promise of free elections and the Communist party changing its name. Those developments were almost inconceivable only six months ago. There is pressure for change in East Germany, which has been marked this afternoon by the resignation of Mr. Honecker. There has been a mass exodus of East Germans who are no longer prepared to tolerate the misery and repression of totalitarian rule.
Everywhere one may go—I certainly found this when I visited Hungary—there is a wide recognition, even among the most committed Communists, that Communism does not work and that Socialism has failed their countries. There is a desperate desire to move towards a free market

economy, which might at last give their people an opportunity—[Interruption] I must tell some Opposition Members—not all, because I no longer know where half of them stand—that Hungarian Communists complained to me about the disastrous inefficiency of state industries and public ownership. The only people who still agree with some Opposition Members are Mr. Honecker and Fidel Castro. In general, the world has changed and moved towards those who want the benefits that a free market economy can bring to their people.
This is a time of change, great optimism and hope, but it is also a time when the West must show great responsibility. It must be prepared to help during these very difficult and dangerous times. It is manifestly a time of great danger because tensions exist within the Soviet Union—a union of 120 different nations. Those tensions are evident in the strikes in the Baltic states, Armenia and Azerbaijan. There are tensions, albeit of a different sort, in eastern Europe and within the Warsaw pact, such as those between East Germany and Hungary and Czechoslovakia about the treatment of the East German refugees. They are the tensions that I experienced during my conversations about the position of Transylvania and the difficulties between Hungary and Romania about the treatment and status of Romanians in Transylvania. There are the difficulties now being posed within the Warsaw pact because of the new non-Communist Government in Poland. When I was in Hungary, Hungarian Ministers were being openly questioned about whether Hungary would go neutral, alongside Austria. What would be the implications of that within the Warsaw pact? A whole range of possibilities exists, and it is a time for great care and constructive thought in the West.

Mr. Heffer: The right hon. Gentleman, like most of his hon. Friends, is now trying to suggest that Labour party members have always agreed with the economic and political system in the Soviet Union. He knows that that is not true. Over the years, most of us have fought strongly against the anti-democratic regimes in the Soviet Union and in east Europe and have defended the rights of all those seeking democracy, but, at the same time, have argued for democratic Socialism in the East and the West. The right hon. Gentleman knows that, so why does he, like Goebbels, persist in a lie?

Mr. King: If the hon. Gentleman does me the courtesy of reading what I said, he will see that I particularly referred to state ownership, state industries and nationalised industries. I have sat in the House long enough to hear the hon. Gentleman's speeches in defence of clause 4 to know how much he subscribes to that and I have listened to Hungarian Ministers telling me what an unmitigated disaster state ownership has been for industries in their country. I understand entirely why the hon. Gentleman is sensitive on that point, but he will understand why history will judge him in the way it will.

Mr. Bob Cryer: Since the Secretary of State is talking about changes in eastern European countries, is it not time to assist that process of change by abandoning the threat of mass extermination with the purchase of Trident, which massively increases our nuclear firepower capacity? Would it not be better to join countries such as Canada, a member of NATO which signed the United Nations nuclear non-proliferation treaty and which will not have nuclear weapons on its soil?

Mr. King: I shall come to the nuclear deterrent and I shall seek to explain to the hon. Gentleman precisely why the sort of policy that he advocates shows that he has learned nothing from the success of the policy of deterrence. At the very time that we are debating the triumph of NATO and the resolute position of the West, which for the first time is bringing the prospect of freedom and hope to the people of eastern Europe, he is peddling the old question—why do not we change the policy that has manifestly succeeded?
It is easy to look at what is happening in eastern Europe and the Soviet Union and feel that there is an unstoppable momentum and that we are inescapably moving towards happier and safer times. But, as I have said before, the dread warning of Tiananmen square could occur elsewhere as a result of the tensions, difficulties and challenges that authorities in the Soviet Union and the eastern bloc countries face. This is a time of great danger while we wait to see how those countries respond to the democratic pressures created by the marching of young people and the other pressures that we see on television every night.
Our greatest comfort has always been the strength and resolution of NATO and its refusal over 40 years—it is its 40th anniversary this year—to give in to blackmail, Soviet pressure, the great arms threat that we have faced and the pursuit of world domination and victory for Soviet economic and social policies. NATO has stood against all that and has proved superior. Such economic policies have failed the Soviet people. Standing firm, strong and united has brought NATO its success. It would be fatal to abandon it or change it until we are certain what the outcome will be.
The siren voices have started. They were echoed in the amendment that was supported by the overwhelming majority of the Labour party conference and in the remark of the right hon. Member for Chesterfield (Mr. Benn) that there is no longer any threat. That is just the sort of dangerous, easy solution that led us to abandon our defences at a crucial time with the consequent disasters of the 1930s.

Mr. Tony Benn: rose——

Mr. King: At a time of great hope, which I hope we all share, for the people of eastern Europe—[Interruption.] I can understand why Labour Members become very embarrassed by this. The hon. Member for Rhondda has already shown how thin his skin is, and he is showing it again now.
At a time of great hope for the people of eastern Europe, the worst that we could now do would be to betray them when our firm stand has brought them the hope and opportunity of freedom. We must not betray them now by dismantling our defences——

Mr. Benn: Quite apart from the fact that the Conservative Prime Minister, Neville Chamberlain, was a firm supporter of Hitler, as captured German Foreign Office documents have confirmed—Lord Halifax was sent to congratulate Hitler on destroying Communism in Germany—will the right hon. Gentleman turn his mind to the point of the amendment? Can he give the House a single reason why Britain should be spending more as a percentage of its gross national product on defence than the average for other NATO countries? It would save us between £3 billion and £4 billion a year if we spent the

same amount on defence as do France, Germany, Italy and the rest. Will the right hon. Gentleman deal with that question, and will he realise that he is not at Blackpool giving another 10-minute ovation to a dying Prime Minister?

Mr. King: I find myself in some difficulty in answering that because I am not absolutely clear which amendment I am supposed to be addressing. Is the right hon. Gentleman asking me to address the amendment that all the Opposition Front-Bench spokesmen voted against at his party conference? If so, he had better ask them why they thought it unreasonable.
I shall explain exactly why it is important for NATO to keep up its defences——

Mr. George Howarth: On a point of order, Mr. Speaker. The Secretary of State has just declared that he is not sure which amendment he is talking about. If he cannot follow his own speech, what chance do the rest of us have?

Mr. Speaker: Perhaps I can help. We are not debating any amendment yet.

Mr. King: The uncertainty was on the part of the right hon. Member for Chesterfield, not on mine.
Although we all hope for a successful outcome of the conventional forces reduction talks and for good will, confidence and trust to grow between the East and us, the Soviet rearmament capability continues virtually unabated. The Soviets still produce one new submarine every six weeks and two new aircraft and six new tanks every day. In certain significant respects, they are modernising their capability. SS21 missile launchers have more than doubled in number since Mr. Gorbachev came to office. We must act in good faith, but we must also recognise that there are uncertainties. Dangers will arise from the tensions in the Soviet Union and from the political instabilities in eastern Europe. The House must not underestimate the enormous logistical challenge to the confidence and trust of the West presented by the Soviet Union.
The unilateral arms reductions to which the Soviet Union has committed itself involve the dismissal of about 100,000 officers—out of 500,000 men—and pose the problem of how to find jobs and houses for them all. How easily can that be achieved? The Soviets' reductions involve the destruction of massive amounts of equipment. What are the chances of these major challenges being met within the proposed time-scale?
Recognising the important point that a totalitarian state can change direction very much faster than any democracy, it would be grossly irresponsible to dismantle our defences now. It is important to maintain stability. If one examines the relationship between NATO and the Warsaw pact, it is obvious that NATO is crucial to us as our insurance for our defence, but I believe that a strong NATO also benefits Warsaw pact countries because they need a stable and predictable Europe.
I was struck by a phrase used by my hon. Friend the Minister of State, Foreign and Commonwealth Office, the hon. Member for Bristol, West (Mr. Waldegrave), about the developments in eastern Europe and the relationship between NATO and the Warsaw pact. He discussed the problems of reductions in arms levels and tension and described the two alliances as two great Sumo wrestlers locked in combat. The real problem for Sumo wrestlers in


disentangling is that, if they move too fast, they can both end up flat on their faces. If super-powers and alliances end up flat on their faces, other people can quite easily get hurt. It is important that we maintain the credibility of our defence. If the Soviets maintain their forward defence capability, it is important that we do, too.
Some of my right hon. and hon. Friends may find my next point more difficult. If we want the process and the opportunity for freedom to develop in eastern Europe, there is a strong argument that in the short term the structure of the Warsaw pact needs to remain as some assurance of stability on that side as we move into this difficult period, provided that President Gorbachev's commitment to non-interference in the internal politics of the countries of the Warsaw pact is scrupulously observed.

Mr. D. N. Campbell-Savours: rose——

Mr. King: In a moment. I want to deploy this point.
That is why it is important at this difficult and dangerous time that both NATO and the Warsaw pact remain in post. They are not the same. If course we do not accept any moral comparison between them, but at this time of great political uncertainty and economic danger we do not want to add to the uncertainty and the fear that could stop those encouraging processes. Given those uncertainties, any suggestion of the denuclearisation of Europe is profoundly irresponsible. The Warsaw pact countries do not expect it at present. We have to stand on the defence and maintain the credibility of our flexible response—[Interruption.] The hon. Member for Bradford, South (Mr. Cryer), having argued against cruise missiles, having stood shoulder to shoulder with the women of Greenham common, and having been profoundly wrong time after time, has the nerve to sit there and parade his opinions again.
I profoundly believe that we should maintain the stability and the security of our defences. In the long term, it matters as much to the Warsaw pact and the Soviet Union to have stability in the Western Alliance. That is why in the short term we respect the situation in the Warsaw pact.

Mr. Campbell-Savours: Will the Secretary of State answer the very simple question that was put to him by my right hon. Friend the Member for Chesterfield (Mr. Benn)? Why should Britain spend a higher proportion of its GDP on defence expenditure than any of our European partners? Why should the Germans pay 1 per cent. less, and the French pay 0·25 per cent. less, and why should the average contribution be 1·75 per cent. less? Why should we be subsidising the European defence effort? Why should not everyone contribute equally?

Mr. King: We should make a proper contribution to the defence of the West. I am proud not only of the cost but of the quality of the contribution that we make to NATO. I am concerned about the financial commitment of some of our allies. It is no secret that we should like some to make a greater contribution. [Interruption.] Instead of bellowing, the hon. Member for Workington (Mr. Campbell-Savours) should try to understand my argument. It is profoundly the wrong moment for us to think about cutting arms.
In the current developments, we have important responsibilities to NATO.

Mr. Paul Flynn: Will the right hon. Gentleman give way?

Mr. King: Will the hon. Gentleman excuse me? I have given way already.
Cm. 675 clearly shows how extensive our commitments have been in other parts of the world. Our commitment in Northern Ireland has been clear, for which I have considerable admiration and pride. Elsewhere we have commitments in the Falklands, Cyprus, Hong Kong and Belize. The Armilla patrol is less active than it was earlier in the year, but it made a great contribution to ensuring the safety of shipping. I do not know how many hon. Members are aware that currently more than 500 members of the armed services are posted in 30 countries helping to train the armies of our allies.
Currently, our armed forces are helping in Namibia, and we have talked about the contribution that they made to the work in dealing with hurricane Hugo. The House may like to know that my right hon. Friend the Prime Minister and I have been in contact with the American authorities to see whether Britain can help with the tragic and appalling earthquake in San Francisco.
Hon. Members who take an interest in the armed forces share my admiration of their professionalism, courage and good humour, particularly in Northern Ireland and other dangerous situations.
I should like to pay tribute to our reserve forces. I did not appreciate until I took over these responsibilities that in time of war more than a third of our contribution would be made by the Territorial Army. From what I have seen of the reserve forces, I have been enormously encouraged by their good humour and skills. The support of employers for our reserve forces is important. We all have constituents who are prepared to sacrifice their time for the defence of their country, and I hope that their employers will help them to make their contribution.

Mr. Dalyell: Having moved from Northern Ireland, and before he leaves the subject of Northern Ireland, on reflection does the Secretary of State believe that there is any case for a serious public inquiry into the difficulties at the Kincora boys' home and the case of Colin Wallace? Have his advisers suggested that that might be desirable?

Mr. King: The hon. Gentleman used to raise that point endlessly at Northern Ireland Question Times. That matter has been examined more times than I can remember. However, if the hon. Gentleman has evidence which he believes should be considered, it should be examined. I have nothing more to add.

Mr. Conway: With regard to my right hon Friend's comments about the Territorial Army, I am sure that his visit to 49 Brigade was deeply appreciated and warmly welcomed.
I want to press my right hon. Friend on an important point. If people want to do part-time military service in Ulster, and if the Ulster Defence Regiment is to be made full-time in whatever shape or form, will my right hon. Friend assure the House that those who wish to continue and promote a military career on a part-time basis in Northern Ireland will find other units in the Province which will be expanded to enable them to do that?

Mr. King: I should like to consider that. Perhaps my hon. Friend the Minister of State for the Armed Forces will address that matter later.
On many occasions I have paid tribute to the work of the security forces in Northern Ireland. While I have been concerned that certain allegations and charges have been made recently—allegations which are under investigation at the moment and, which in the interests of the good name of the UDR, must be properly and fully examined—I pay tribute to the amazing courage and dedication of all the security forces in Northern Ireland who risk their lives every moment of the day and night in their willingness to defend their communities against terrorism. We should always remember that.
I want to refer to the question of security for all our armed forces. At the present time, they face an evil terrorist threat; and the tragedy in Deal since the House last met is fresh in our minds. The threat poses major challenges for us in terms of living in a democracy and a free society and not in an armed camp. Terrorists have evil ways in which to exploit that situation. We will do our best to ensure that the most sensible security arrangements can be made. I hope that we can all stand together on that and will not try to make party political capital out of a threat to the democracy of this country. It is important that the House stands together on that point.

Mr. David Winnick: Will the right hon. Gentleman give way?

Mr. King: No. I have given way a lot already.
Cm. 675 sets out the resources that we seek to maintain our defences and our success in keeping those defences up to date. In the expenditure in the current year—£20,000 million, which is 16 per cent. higher in real terms than it was in 1978–79—we have sought to modernise our nuclear and conventional forces.

Mr. Martin O'Neill: Has the Secretary of State moved on from the question of security at home bases and Deal? I believe a meeting was held in London last week at which the Under-Secretary of State for Defence Procurement was present involving the trade unions involved in security and defence matters and the Ministry of Defence. Will the Secretary of State give us some information which might confirm reports in The Guardian that the attitude of the MOD is beginning to change in relation to this question?

Mr. King: That is a wonderful leading question. I did not see the article in /The Guardian. If the attitude is that we are determined to do our best in terms of security in facing these difficult problems, that attitude has not changed. My hon. Friend the Under-Secretary of State for Defence Procurement met some union representatives, and he may want to comment on that later if he catches your eye, Mr. Speaker.
I have made my position about private security guards quite clear. If they can help and be a useful addition to the security arrangements, and provided that they are of the standard of competence that the security forces deserve, they have a role to play. However, I set high standards, and I am not prepared to accept incompetence or inadequacy in such arrangements. We are examining that at the moment. I hope that that will help to make our position clear.
New equipment has come into service during the past year. We are continuing to modernise and develop our defence capability, and my hon. Friend the Minister of State for Defence Procurement will say more about that tomorrow if he catches your eye, Mr. Speaker.
The overriding background to our procurement policy has been the progressive development of a more competitive approach. We spend substantial sums of money. The Ministry of Defence is the largest customer in Britain and for that we expect quality. At a time of arms reductions and a reduction in conventional forces, the reliability of equipment will become ever more important, and we shall be stressing that.
In addition to encouraging a more competitive approach for the major equipment programmes, we are keen to encourage the opportunity for more small businesses to be able to quote for and to supply Ministry of Defence requirements. I am encouraged by the growth and substantial increase in the number of firms now supplying the Ministry of Defence. That competitive and competent approach is one that we apply also to collaborative projects and to the activities towards creating an open European armaments market. The development of the independent European programme group has been encouraging in the past year. In case it might be misunderstood in other quarters, that is not to develop a fortress Europe but to ensure that we strengthen the European contribution to the overall NATO effort.
In respect of the overall work of the Ministry of Defence, we are developing a new management strategy. My predecessors, particularly my right hon. Friend the Member for Henley (Mr. Heseltine), made key changes in the way that the Ministry of Defence operates. Resources are now allocated across service boundaries and the armed forces are integrated at the top level without diminishing their individual characteristics or denying the healthy rivalry that keeps them on their toes. Further changes are needed in the way in which the Ministry of Defence manages resources away from the centre where local managers can be hamstrung by a host of central controls.
We are introducing a major change with the new management strategy. Under this, financial responsibility will be put together with executive responsibilities. That will go right across the Ministry of Defence and the armed forces, covering all defence expenditure except for equipment projects managed by the Procurement Executive. Individual managers and commanders will have delegated authority to enable them to make the most efficient use of the resources allocated to them. The objectives and targets set for each of them will come from the Ministry of Defence overall plans, and our target date for implementation of the new management strategy is 1 April 1991.
The new approach can be a major step forward in obtaining better value for money and reducing some of the frustrations that flow from not giving enough discretion and authority to the people responsible for the different units and activities.
Under the "next steps" initiative, the Government are developing arrangements under which some functions of Government are transferred to agencies which can operate with greater freedom from central controls. We have been considering what scope there might be for those in defence matters. As my hon. Friend the Under-Secretary of State for Defence Procurement announced recently, the Meteorological Office will become a full "next steps"


agency next year. That will be followed by an agency formed from the four major non-nuclear research and development establishments.
Many support activities are an integral part of the overall military capability and may have important links to NATO allies. Clearly they must remain part of the Ministry of Defence. To obtain the benefit of the energy and enthusiasm that can come from the "next steps" approach, we are planning to designate a number of our support organisations as a new category of defence support agencies. They will be run internally on "next steps" lines but would remain within the defence chain of command.
We have identified five organisations that look suitable to become defence support agencies. The Hydrographic Office at Taunton is planned to start next April; service schools in Germany, military survey, defence accounts and RAF training should start the following year. We are also looking at 10 more activities, ranging from naval stores to chemical defence research, as other possible candidates, and there could be more after that.

Mr. John Wilkinson (Ruislip-Northwood): What does my right hon. Friend mean by Royal Air Force training coming under the "next steps" approach? Surely that is of great operational significance. Will my right hon. Friend clarify his remarks?

Mr. King: We will be looking at the training part of support command within the overall defence chain of command. We have identified ones that look suitable for defence support agencies. We will look at them very carefully. I hope that my hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson) agrees that there are great benefits in giving a greater feeling of authority and responsibility to people and for them to be recognised as discrete activities that should have a structure and a clear responsibility channel of their own, but there is more work to be done and we must take more careful note of my hon. Friend's point.

Mr. O'Neill: From what the right hon. Gentleman has said, is it right to believe that the training of apprentices will now be privatised? Is the right hon. Gentleman suggesting that the training of the young men who go into the Army will be taken over by private companies under some kind of agency structure? Is that what the "next steps" policy will be?

Mr. King: Some of it happens now in different arrangements with outside agencies in any case in terms of release schemes and block release schemes for the training of apprentices. We must consider several aspects when looking at the best ways in which that might be done. My hon. Friend the Under-Secretary of State for Defence Procurement will give the hon. Gentleman a fuller answer. I should like that matter to be looked at in more detail.
At this time, after many defence debates, we face a quite different situation. The confrontation between the Warsaw pact countries and NATO over many years appears to be changing, and it poses many challenges for us.

Mr. Flynn: Will the right hon. Gentleman give way?

Mr. King: if the hon. Gentleman will allow me, I will not give way.
I am delighted that the House has such an early opportunity to debate such serious matters for our country. Although much has changed, so much of the debate is the same. I read the reports of last year's debate. I said earlier that there were two Labour party amendments, of which the Opposition Front Bench amendment was the minority one. We have exactly the same situation this year. Last year the hon. Member for Clackmannan (Mr. O'Neill) spoke against it and tried to prevent his backwoodsmen from voting as they did. It must have been a great sadness to him that they achieved a majority twice as big as he was able to achieve for the official motion. It is true that that motion was carried by 4·2 million votes to 1·9 million. It was more than a 50 per cent. majority. That majority involved a reduction of £5,000 million from our defence expenditure.
I heard the comments that were made by the hon. Member for Clackmannan and by the Leader of the Opposition. They said, "Don't worry, it won't happen," but that is what the overwhelming majority of his party actually want to do; there is no question about that. I looked at the Labour amendment which was tabled last year. It was more specific. Opposition Members were not quite so clever last year, because they actually spelt out the sum. They said, "Reduce expenditure by £7,000 million." This year they have tried to dress it up and say, "Reduce it to the average of the western European level of NATO countries," and it is just under £5,000 million. However, Opposition Members keep coming back to that point, and their party conference keeps overwhelmingly voting for it.
If that is what his party wants, what does the Leader of the Opposition want? [Interruption.] No, he knows exactly what he wants: he wants to get elected. He knows that the policy of leaving this country defenceless destroyed his chances in the general election, as it had destroyed his predecessor's chances, because the British people will not stand for such a policy. If he were elected, what would he do? What does he believe? Who trusts the Leader of the Opposition with the defence of our country?
The most telling remark in the Prime Minister's speech at the party conference was:
if you aspire to serve your country in Downing street a good motto is: to thine own self be true.
What is the right hon. Gentleman's own self? There is a deep belief that, whatever he says, he is in favour of unilateral abandonment of nuclear weapons and is deeply in sympathy with the amendment of the hon. Member for Liverpool, Walton (Mr. Heffer). That is what motivates the anger of the right hon. Member for Chesterfield and his colleagues. Deep down they think that the Leader of the Opposition has betrayed them and that he used to believe as they believe. Deep down he continues to share their belief.
If we analyse why there is a better prospect for peace in the world and a chance of better relations between the great powers and between NATO and the Warsaw pact, is it not because at last there is a degree of trust and confidence between the leaders of the world? Confidence started with President Reagan and Mr. Gorbachev. From their entirely different political philosophies and perspectives they were able to do business. Mr. Gorbachev and our Prime Minister also have different philosophies, but an element of confidence and trust grew. That trust is important not just for allies but for potential opponents. If we are to make progress in reducing conventional arms,


nuclear arms and chemical weapons, there must be some trust and confidence at the top about where individual leaders stand.
The profound weakness of the Labour party and of the Leader of the Opposition is that there is no credibility, no trust and no assurance of where they stand. If anybody does not believe what I say, they should read the amendment. It is a pathetic cobbling together of a series of different Labour party aspirations as it tries to jump on one bandwagon or another. To offer that as an alternative credible defence policy for this country is absolutely pathetic.
What came out of the Labour party conference was a proposal carried by an overwhelming majority to slash the conventional defences of the United Kingdom and negotiate away our nuclear deterrent, leaving us defenceless. These defence estimates show clearly that we are not prepared to leave this country defenceless.

Mr. Andrew F. Bennett: Will the Secretary of State give way?

Mr. King: We are proud of what we have done for the defence of this country and of the role we have played in NATO and what that means for a better future in Europe and a safer world. That is why I commend these estimates to the House.

Mr. Martin O'Neill: I beg to move, To leave out from "House" to the end of the Question, and to insert instead thereof:
believing that the Statement on the Defence Estimates 1989 has been overtaken by the superpower disarmament initiatives, and supporting those agreed at the 1989 NATO Summit, considers that Her Majesty's Government should undertake a Review to ensure that Britain is defended by properly supported Armed Forces and by the negotiation of verifiable disarmament agreements, to assess future commitments and priorities, to provide Forces and defence industries with a framework to plan future needs, and to examine the allocation of resources which could be released for social and economic purposes; recognising that negotiated disarmament is now more probable, and welcoming progress towards a world-wide treaty banning the possession or production of chemical and biological weapons, calls upon Her Majesty's Government to support NATO in seeking to reduce short-range nuclear forces before complete implementation of any conventional force agreement and to delay a decision on the Lance replacement; urges Her Majesty's Government to seek NATO's abandonment of the destabilising flexible response strategy; demands that Her Majesty's Government indicates its willingness to participate in the next stage of the START process; recognising the impact of government economies and the lack of an industrial procurement strategy on the Services and on major contractors now vulnerable to foreign takeovers, calls upon the Government to establish a Conversion Agency to employ the skills and resources of the defence procurement industry in the civil sector; condemns the cowardly attacks of murderous paramilitary groups; and demands that the Government ends the sacrifice of safety at military bases and establishments by the excessive dependence on private contractors.
First, may I welcome the Secretary of State to the Dispatch Box in his new role and to his new Department? A few months have intervened since his appointment, and I recognise that he has not had the easiest of rides. It may be less bumpy than his previous job, but many of the problems seem to take the same form as the ones that he had to confront before.
I share the Secretary of State's appreciation of the efforts of the Select Committee on Defence. The Select

Committee is something of a double-edged sword to everybody: it is independent, it exerts its independence and it speaks with authority. We must listen to it. During the year, I hope that the Secretary of State will offer more time than his predecessor for discussing the Select Committee's reports, because the one report appropriate to today's debate is only one of the many that require more of our attention. If the worth and value of the Select Committee system means anything, we must debate such Committees' well-considered findings.
I welcome the institution of the centre for defence studies. However, as a Scot, I am not happy about the concentration of defence research institutions in the south-east of England, although I can understand the convenience of that for many of those who wish to avail themselves of the facilities. It is a welcome step and is in line with something started 20 years ago by my right hon. Friend the Member for Leeds, East (Mr. Healey) when he first established departments of defence studies at a number of universities, of which Bradford was one, although I believe that that was funded also by organisations such as the Quakers.
I advise the hon. Member for Colne Valley (Mr. Riddick) who was responsible for that silly and mindless attack on Bradford, that hon. Members are ill-advised to attack academic institutions, irrespective of whether they appear to be of one political persuasion or another because we in the House stand for the defence of academic freedom and for the considered judgments of people who should be able to operate without interference from politicians.
I hope that the easy applause that the hon. Member seemed to get from some of his hon. Friends will be reconsidered in the light of what I have said. Many of those institutions—indeed, all that are involved in defence research in this country—contribute to the debate in much the same way as the Select Committee, and the introduction to their ranks of another such institution is welcome.
As the Secretary of State said at least four times, this is an appropriate time for such a debate. It is now nearly six months since the publication of the Estimates. Perhaps the Secretary of State will consider trying to get the report out by the beginning of April so that the Select Committee can then produce its report and so that we can have a proper debate before the summer recess. We need to look at the report when the print on it is still relatively fresh and when some of its issues would have more relevance than they do at present.
The super-powers are finding a great deal more common ground and we recognise that the old order is changing. It would be remiss of all of us not to note the passing to another of Mr. Honecker's leadership in the German Democratic Republic. We can only watch that space with interest, because if the experiences of Poland, Hungary and the Soviet Union are anything to go by, we can look forward with some cautious optimism to what is happening in eastern Europe.
The optimism that we all share presents us with a challenge because we do not really know how to respond to the changes. We do not want to frighten off the laggards. We want to be able to consolidate the achievements of those who are now enjoying new freedoms. and who look to us for encouragement and assistance. We have had independent gestures followed by constructive responses from both sides. Most importantly, we see the prospect of a major change in the balance of forces in


Europe. The NATO summit in May was too late to be considered in the White Paper but it must be regarded as the starting point for a new European order.
The response given by President Bush to President Gorbachev's United Nations speech was both timely and far-reaching. The manner of its presentation left its opponents little room for manoeuvre. Certainly, the Prime Minister and the former Secretaries of State for Defence and for Foreign and Commonwealth Affairs have had to eat their words. Their grudging support for the NATO summit communiqué and the Comprehensive Concept was not enough to prevent them from being isolated from the rest of our NATO partners. It merely served to confirm to the British electorate that in a changing Europe only our Prime Minister and her colleagues still want to live in the cold war—[Interruption.]—a view that was endorsed in the European elections in June.
The Government's record over the past 12 months has been to rubbish any gesture made by the Warsaw pact members and to seek to stand in the way of changes promoted by the United States and our NATO partners. When faced with a fait accompli, as at the summit, they try to put a totally different emphasis on what has been agreed.
On the question of the follow-on to Lance, the right hon. Member for Ayr (Mr. Younger) said on the BBC on 30 January:
I hope that by the summertime, NATO will have made a decision with our help.
On Channel 4 on 27 April, the then Foreign Secretary was asked if modernisation could be put off until after the West German elections in December 1990, and said:
I think that's a dangerous proposition.
However, the Comprehensive Concept, signed by the United Kingdom on 30 May, states in paragraph 49:
The question concerning the introduction and deploy-ment of a follow on system to Lance will be dealt with in 1992.
On the question of the relationship between NATO and the Warsaw pact nuclear forces, the former Foreign Secretary was asked on "Panorama" on 3 April:
How can NATO justify to Western public opinion and to Western German public opinion the modernisation of short range nuclear missiles based on West German soil?
He replied:
Most simply by the extent to which there has been taking place a massive modernisation of Soviet short range nuclear weapons".
Yet paragraph 44 of the Comprehensive Concept, which was signed by the Government, states:
the sub-strategic nuclear forces deployed by member countries of the Alliance are not principally a counter to systems operating by the Warsaw Treaty Organisation".
On the issue of the need for NATO nuclear forces to compensate for Warsaw pact conventional superiority, the former Secretary of State for Defence said on 12 May:
As long as we face an enormous conventional threat, thousands and thousands of tanks facing us, we cannot afford to be without our nuclear shield".
However, paragraph 27 of the Comprehensive Concept states:
The Allies substrategic forces are not designed to compensate for conventional imbalances.
On the timing of the negotiations on short-range nuclear forces, the then Foreign Secretary, in a memo to the Select Committee on Foreign Affairs, stated:

the Government believe that after the INF agreement and the possible START agreement, the Alliances next Arms Control priorities must he a global ban on chemical weapons and the elimination of the conventional imbalance in Europe. Until these have been achieved, it would be dangerous to embark upon negotiations which might lead to any further reductions in nuclear weapons in Europe".

Mr. Edward Leigh: rose——

Mr. O'Neill: Perhaps the hon. Gentleman will let me finish my point.
Paragraph 48 of the Comprehensive Concept states that, once
a conventional force reduction is underway the United States, in consultation with the Allies concerned, is prepared to enter into negotiations to achieve a partial reduction of American and Soviet land based nuclear missile forces of shorter range.
Even after the Government signed the Comprehensive Concept, 14 days after the summit, the then Secretary of State for Defence said in the House:
we do not think that it would be sensible to start negotiations for the reduction of nuclear weapon systems until the complete implementation of any reductions under the CFE." —[Official Report, 13 June 1989; Vol. 154, c. 691.]
Not only did the Government not agree with the delay in modernising Lance, as accepted by the rest of NATO; they disagreed with the reasons for the Alliance having those missiles, and even now refuse to believe that the timetable for their elimination is either sensible or safe.
In virtually every fundamental of the conventional forces in Europe talks, the Government are out of step with the rest of our NATO partners. On the biggest breakthrough of all—aircraft—the Government have shown themselves to be completely out of touch.

Mr. Leigh: Does the hon. Gentleman not think it ironic that there is a certain symmetry in history because 50 years ago in the 1930s—at the time of George Lansbury—the Labour party conference decided to ignore the conven-tional imbalance and to abolish the Royal Air Force and today, 50 years later, the Labour party conference voted by two to one to cut conventional defence spending by one third? Which part of the service, or which service, does the hon. Gentleman think should be abolished?

Mr. O'Neill: It is always annoying when a queston is asked that has no relevance to what we are talking about. If it could be guaranteed that the hon. Member for Gainsborough and Horncastle (Mr. Leigh) would be here until the end of my speech, I might wait until then to answer his question. However, I shall answer it now and then refer to it later in my remarks.
Several different resolutions were presented at the Labour party conference. The substantial document on the Labour party's policy on defence and foreign affairs was accepted without a counted vote, such was the overwhelming majority. That is the document on which the next Labour party election manifesto will be based and on which the defence policies of the next Labour Government will be decided.

Mr. Leigh: Will the hon. Gentleman give way?

Mr. O'Neill: No. I made the point clearly enough for the hon. Gentleman and for everyone else.

Mr. Tom King: It would be helpful for us to clarify this point. W hat is the significance of the 4 million votes at the Labour party conference? Will the point be totally disregarded?

Mr. O'Neill: That point will not appear in the Labour party manifesto. I shall explain why in a minute.
I shall return to conventional forces in Europe, which is the form of disarmament that we have to consider now. It is a form of disarmament that owes little to this Government, especially in respect of aircraft. It has been clear that the Soviet Union has been pushing for a long time for aircraft to be included in the disarmament talks. The Soviet Union's aim was to secure the best agreement on both reductions and deployment of aircraft because it believed that it was one of the areas in which NATO superiority was most evident.
It was also one of the most sensitive questions involving definition, as no one could agree on either offensive or defensive air systems. Yet it was President Bush, a man whom many of us—and I must admit to being one—considered to be merely a timid conservative, who took the bold step of calling for their inclusion. Will the Secretary of State tell us whether he stands by the words of his predecessor when he spoke to the Defence Select Committee on 17 May last? He said:
I think the calculations on aircraft and types of aircraft and who has got what are still very far from clear … I believe that trying to bring those in at this stage is very likely to bog down the whole enterprise and it would be much better to proceed on the agreed mandate which has been agreed by both sides on CFE to try and make progress on that.
Within a fortnight, on 30 May, the Government signed the summit declaration, which in paragraph 17 called for
reductions by each side to equal ceilings at the level of 15 per cent. below current Alliance holdings of helicopters and of all land-based combat aircraft in the Atlantic-to-Urals zone.
We welcome the outcome of the NATO summit and the proposals for rapid progress on CFE. We look forward to the first round of conventional cuts and share the enthusiasm of people such as Senator Sam Nunn and Congressman Aspin, the chairs of the Senate and Congress Arms Committee, and people such as Ed Rowny, who have been long-time ambassadors and arms control negotiators. They believe that cuts can go far below the levels that CFE presently envisages and that we could be down to cuts of about 50 per cent. by the early 1990s.
Before anyone gets carried away, I must say that cuts in themselves do not bring stability. We can have parity, yet still have instability. We need not only changes in numbers, but new military doctrines, to take advantage of the reduced numbers I wecome the remarks of the Secretary of State concerning his discussions with Yazov and the Hungarians. I wish only that some of that could have been anticipated in the "Statement on the Defence Estimates".
One of the gaping holes in the document is any possible consideration of changes in the military doctrines and strategies behind NATO thinking. I am surprised that some hon. Members have not already started raising questions about force to space ratios, the continued desirability of deep strike capabilities, albeit with far fewer forces, and the prospect of participating in what would be simply a small-scale blitzkrieg. It is depressing to read the defence estimates because there is no fresh thinking on strategic and doctrinal issues. If one speaks to German conservatives or German liberals, right across the political spectrum, one finds that they want to talk about different

strategies and different doctrines. They want to take the consequences of the possible outcome of CFE and explore them, so that the next range of talks can proceed in a far more constructive way than the already successful progress we have made.
The question of the prospects for military peace in Europe is underpinned and underlined by what has already happened in the Soviet Union. The proposals made in the United Nations speech in December have been given rigorous analysis in the latest IISS "Military Balance" book, in which the editor, Francois Heisenbourg, writes that the short warning or surprise attack scenario is now barely plausible. Although he says that longer warning scenarios will be less affected, the necessary preparation time for the Warsaw pact will be increased and this in its turn should enhance NATO warning and preparation times.
The report stresses that a great deal has yet to be done and that false optimism should be discouraged. However, caution does not mean that we always have to move at the speed of the slowest. The most depressing part of the speech by the Secretary of State was perhaps the part where he said that we have to keep things roughly as they are now until we can consolidate on the progress that has been made. I understand the motivation behind that remark and I have some sympathy with the intention, but I must say, with great respect, that this is the wrong time to be putting such arguments. If we go forward too cautiously at this time, we shall end up on the side of the forces of reaction.

Mr. Julian Brazier: Will the hon. Gentleman remind the House in which particular area the first major breakthrough in this decade took place in arms reduction talks? Will he remind the House that in that area —intermediate nuclear weapons—the breakthrough occurred precisely because the West had decided to be cautious—the hon. Gentleman may say over-cautious—by introducing its own weapons?

Mr. O'Neill: The intermediate nuclear forces talks and their success can be attributed to many factors. Caution was in some ways justified then. There was no record of constructive dialogue until then. However, since then we have had the success of INF and the progress so far in the START talks. We are reaching a clear understanding on where we are going in CFE. To compare the situation before 1986, which was when the INF business got under way after Reykjavik, with today is to ignore the changes of the past three years. The hon. Member for Canterbury (Mr. Brazier), in seeking to find a means of defending this Government's caution, wholly misunderstands the nature of the present circumstances compared with 1986.
There must be an awareness that the Warsaw pact reductions are driven as much by economic necessity as by a revision of East-West relations. Nevertheless, we can all see that it cannot be assumed that a Russian advance through Hungary, Poland and even East Germany would go as smoothly as it might have done some years ago.

Mr. David Shaw: Will the hon. Gentleman give way?

Mr. O'Neill: No.
It is fair to say that, in the short term, when we get to the fruits of CFE, the United States and the Soviet Union will have to share the bulk of those fruits. I do not consider


that the United States burden-sharing argument has any great weight, but I believe that it is important that we get the first round of CFE cuts through as quickly and cleanly as possible. It would be foolhardy for us to try to get a bit of the action, for whatever reason. I realise that there have been calls for the French and ourselves to participate, but although that is attractive, it must not be the highest priority. We should be able to try to ensure that the United States and the Soviet Union can benefit—initially at least —from the CFE talks.
I do not say that to give credence to American claims about burden-sharing. Probably only 60 per cent. of United States defence expenditure is accounted for by the expenditure on NATO—3·6 per cent. of the United States' gross domestic product. That percentage can be reduced even further, given that it includes expenditure on reservists who are based in the United States but can be used almost anywhere in the world.
Like Britain, the United States has a volunteer army. This means that service personnel must be paid at least the national average wage. A recent study carried out by the Swedish International Peace Research Institute, which was included in the institute's 1989 year book, suggests that, if countries such as France and the Federal Republic of Germany had a volunteer armed service, their expenditure on defence as a proportion of GDP would rise to about 4·3 per cent. and 3·5 per cent. respectively. The figure for the Federal Republic of Germany does not include expenditure on Berlin. If it did, there would be little difference between the German figure and the figures for the United Kingdom and the United States.
The other cost that is not calculated when considering the cost of conscript armies is that of the far higher proportion of the productive labour force that is denied to the civilian economy because of time spent in uniform.
This shows that it is difficult to make a comparison based on a simplistic criterion when talking about defence expenditure. These costs do not include the social and environmental costs in the Federal Republic of Germany of having the towns and countryside damaged by military manoeuvres. They do not take account of the problems associated with having 400,000 troops from seven countries conducting 5,000 field exercises and 600,000 sorties every year over German soil.
For the United Kingdom, we must take account also of our geostrategic position as an island on the rim of Europe. We have assumed, correctly, naval responsibilities far greater than those of any other European NATO partner. This requires considerable expenditure on capital assets such as frigates and aircraft as well as the most rigorous and expensive training programmes.
If the United Kingdom were to move to the average level of our western European allies—whatever that means —it would have to slash the pay and conditions of our armed services or introduce conscription. The Labour party will not go down that road. We will seek reductions and economies and pursue a value-for-money policy, but not at the expense of our responsibilities to NATO. No Government faced with the choice of spending money on the Health Service, education or defence will want to deny resources for social expenditure. The present Government

have succeeded in reducing expenditure from £19·57 billion in 1984–85—using 1987 prices—to an estimated £17·7 billion this year.
It was surprising that in his lengthy speech the Secretary of State, who tried to poke fun at the Labour party, did not in any way spell out the financial provisions that will be made in forthcoming years to take account of increased demand, if only because of interest rates and exchange rate differentials. It is true that planned defence expenditure will rise by 1·2 per cent. next year and 1·3 per cent. in the following year, but that assumes inflation of 5·5 per cent. this year, 4 per cent. next year and 3 per cent. in 1991–92, with other indicators such as interest rates and exchange rates remaining constant. Defence expenditure in the United Kingdom stood at 5·3 per cent. of GDP in 1984; by 1988 it had fallen to 4·3 per cent.
The Government now spend more on health and education than on defence. This is reflected in, for example, the numbers directly employed by the Ministry of Defence civilian labour force. There were reductions of 21,000 in 1987 alone, making a drop of 28 per cent. in five years, with basic industrial grades—the lowest paid—losing some 40 per cent. of their jobs.
The figures for employment in defence-related industries show an even more alarming fall. It has been caused by a decrease in non-Trident, new component spending of 31 per cent. in the past five years and by a fall of 19 per cent. in spending on spares and repairs. The reduction has been most pronounced in air systems, where annual spending has fallen by £1 billion, or 27 per cent. The picture is similar for sea systems, where expenditure is likely to fall by £870 million, or 31 per cent.

Several Hon. Members: rose——

Mr. O'Neill: Let me finish the figures, and then I will let hon. Members intervene.
Expenditure on land systems will fall by £300 million, or 15 per cent. It is little wonder that firms such as Westland despair of ever getting an order for a new generation of helicopters, or that warship yards are hanging on by a thread.

Mr. Alfred Morris: My hon. Friend has referred to Westland. The Secretary of State talked about happenings during the parliamentary recess. He said not one word about what has happened to Ferranti. I know that my hon. Friend has a considerable interest in the future of that important firm. Thousands of Ferranti employees work in Manchester, not least in my constituency. Decisions are to be taken by the Ministry of Defence that will affect security of employment in that firm. My hon. Friend might have thought it appropriate if the Secretary of State had said at least one reassuring word to those employees. Will my hon. Friend press him on that important point?

Mr. O'Neill: I am grateful to my right hon. Friend for raising that point about Ferranti. This is the best example of the Government's apparent unwillingness, or inability, to defend this country's defence industry base. Firms such as Westland and the warship building yards are hanging on by a thread. We had thought that we might hear—it may happen tomorrow; we can only hope—about the NFR90 project, which has finally foundered. I hope that the Minister can explain what will be the next round in the process.
People are very anxious. I speak on behalf of many Labour Members who still have warship building interests in their constituencies. The issue is of such national importance that it should have featured in the speech by the Secretary of State—a matter on which I agree with my right hon. Friend the Member for Manchester, Wythenshawe (Mr. Morris). I know that the Secretary of State wants to divide the ministerial labour, but there are national economic and industrial matters that impinge on defence, and the House is entitled to know about them.

Mr. Robert Hayward: The hon. Gentleman ducked questions about the Labour party conference and expenditure levels. Will he comment on a statement in The Times of Thursday 14 September which is attributed to him? He said that production lines would disappear if the Labour party came to power. Will the hon. Gentleman identify—possible in answer to the question put by the right hon. Member for Manchester, Wythenshawe (Mr. Morris)—which production lines and research establishments he expects to disappear under Labour party policy?

Mr. O'Neill: Unfortunately, the hon. Gentleman read only that part of the paper which he was given by the Whips Office that was underlined. If he had read the rest, he would have seen that I said more than that and that I qualified my comment. I shall refer to that later and, if the hon. Gentleman wishes to wait, he will hear it.
The much-vaunted system of competitive tendering which the Secretary of State mentioned at the end of his speech is causing some disquiet—not just because of the delays and because the longer the system continues, the more limited the savings will become, but because of the widespread feeling among many defence procurement firms that price is the be-all and end-all and that quality is taking second place.
The Secretary of State said that this was not the way in which the system should operate, but ever-increasing numbers of defence manufacturers to whom I have spoken are getting more worried about the problems of providing the quality with which their firms have been associated in the past at the prices that the Ministry of Defence is demanding. Those views are held not by people who have been unsuccessful in winning contracts but by those who have been successful and who are embarrassed by some of the standards that they have to sacrifice to maintain orders and jobs.
We have to recognise that the other anxiety of defence manufacturers is that there is an absence of long-term planning in the Ministry of Defence. The short-term thinking, the simplistic, free market approach to procurement, may seem attractive to ideologues and right-wing think tanks, but it brings no comfort to designers, planners and defence contractors, or to service personnel who see their NATO colleagues getting more and better equipment than they do.
The events of this summer have shown conclusively that, not only are the Government indifferent to the production and planning requirements of our defence procurement industry, but they seem to have completely ignored their responsibility to British firms in the restructuring of the European defence economy. We search in vain for any Government prescription for British defence companies. It is the responsibility of the Government to secure the lines of supply for our forces.
We cannot meet all our own defence needs. We have to import some goods and produce others under licence. We cannot afford to develop all our own equipment. Some of this work must be undertaken in collaboration with our allies. The West German and French Governments realise that. They take an active part in the development of a procurement strategy.
What was the Government or the MOD position about Plessey in 1987? We were told that it was one of opposition to the GEC bid, but when GEC was joined by one of Plessey's competitors from abroad, the new bid was somehow acceptable. It seems strange that a bid which was unacceptable because it involved the establishment of a British monopoly somehow became attractive when a foreign firm became involved.
When the board, or more particularly the chairman, started looking at International Signal and Control, the Procurement Executive tried to warn it off. Did the MOD have any involvement the following year when a minority on the board had a report Commissioned that suggested that this was neither an acceptable nor a desirable merger partner?
Even now, when every City page seems to carry a story about another defence contractor taking an interest in buying the company and plundering its assets, the Secretary of State's policy seems to be one of wait and see —leave it all to Sir Derek Alun-Jones, the man who got it so wrong last time, in the hope that he may get it right this time. Getting it right for whom—the shareholders and the institutions who sat idly by when Guerin conned the board? Getting it right for the board itself, many of whom believed that, were it not for the serious plight of the firm, their heads would be rolling in the boardroom as well?
There are more people who are interested in what is happening. We have to get it right for the British armed forces, who are dependent on the products of one of our finest companies. Our third largest defence contractor's design team is worried to death about the uncertainty surrounding it.
The Secretary of State knows of our concern about the future of the firm. We are grateful for the trouble he took when he agreed to meet us. He knows the critical role which the radar system for the European fighter aircraft plays in this sorry business. The contract for the radar was to be signed more than 12 months ago—or, as somebody put it, more than three Defence Procurement Ministers ago. Ferranti won the NATO European Fighter Management Agency assessment on technical merit, with price a secondary consideration. It won the Eurofighter assessment by three to one. In March, the then Secretary of State backed it. In June, the West German Government objected to what they called the perceived risks of ECR90, so a joint study between the Federal Republic and the United Kingdom was set up. It showed that ECR90 was not a higher risk, and probably less risk, than MSD 2000. Then AEG tried to reduce the price by contract manipulation. In the end, that worked against it, and ECR90 was still cheaper.
Now it appears that the goal posts have been widened once again to allow AEG to improve its technical performance. It has been suggested that the Government have agreed that AEG be given an indication of the technical shortcomings so that it can try to correct them and have another chance at getting Ferranti's order. How long will this farce go on? If we do not get an answer today,


I hope that the Under-Secretary of State for Defence Procurement will be able to tell us more about it tomorrow.

Mr. Dick Douglas: Is it not remarkable that the Minister has had discussions on this issue but has not seen fit either to intervene in the speech of my hon. Friend the Member for Clackmannan (Mr. O'Neill) or to give us an indication of his view on this crucial matter?
There is not only the question of procurement. I hope that my hon. Friend the Member for Clackmannan agrees that a strategic analysis of a vital defence industry in Britain is involved here. Will we get an assurance? If the Secretary of State cannot give us an assurance today, will the Under-Secretary of State give us a clear indication of the Government's attitude tomorrow, at the end of the debate?

Mr. Tom King: rose——

Several Hon. Members: Go on.

Madam Deputy Speaker (Miss Betty Boothroyd): Order. We cannot have one intervention immediately after another. I call Mr. O'Neill.

Mr. O'Neill: I am happy to answer the question that my hon. Friend the Member for Dunfermline, West (Mr. .Douglas) asks, but I think that the Secretary of State would make a better job of it.

Mr. King: The hon. Member for Clackmannan (Mr. O'Neill) did me the courtesy of saying that I met him and a number of his hon. Friends who came to see me to express their concern about these serious issues that affect Ferranti. I cannot remember whether the hon. Member for Dunfermline, West (Mr. Douglas) was able to be at that meeting.

Mr. Douglas: No, I was not.

Mr. King: I think that the consensus that came out of that meeting was that there are difficult issues to be faced and that there is a need for responsible action by all concerned. We are all deeply concerned about the employees of that company. Perhaps the hon. Member for Dunfermline, West chooses to make Ferranti a political football. I excuse him, as he was not able to be with the deputation that came to see me. I am sure that he was not able to be there for a good reason. At that meeting, I expressed my concern, and the deputation expressed its appreciation of the message of assurance that I was able to give to Ferranti, that the Ministry of Defence had issued.
Ferranti is a valued supplier and contractor to the MOD. It has some £450 million-worth of contracts. We look for an early resolution to the present problems which have affected the company for extraneous reasons not connected with the Ministry of Defence. We hope for a resolution because we value the company, the people who work for it and the skills they represent. We hope that there will be a successful conclusion. I shall say no more today because it might not be helpful to do so in the difficult situation in which the company finds itself at present, and which it has to resolve.

Mr. O'Neill: I recognise what the Secretary of State has said. The point that I was endeavouring to make is that there has been another turn of the screw in the procurement procedure—the extension of the survey procedure to allow AEG yet another bite at the cherry. We were not able to discuss that on the occasion to which the Minister referred.
During the early stages of the crisis that faces Ferranti, many of us argued for a speedy conclusion. We now recognise that it will take longer. We do not deny that. What we would like to get from the Minister, if not publicly—I will not push him any further, for the reasons tat he has given—is an assurance that the British Government will give the same support to the ECR90 as the West Germans are giving to the MSD2000. We would like to make sure that the Secretary of State takes a close interest in the merger dealings and proceedings and that he will try to ensure that the merger does not take place before the radar deal is completed, because it is of considerable significance to the future good health of a company which employs a large number of people.
I have to declare a slight interest in the matter. My father is a beneficiary of the Ferranti pension scheme, having been a foreman there for the best part of 25 years. I therefore have a family interest. If one scratches many people in the east of Scotland, there will be very few who do not have a relative who is employed by Ferranti or a subcontractor to it.
Although this is a defence debate, a transfer of technology takes place in Ferranti, and this means that many of the civilian products that it makes derive from the work done originally for defence products. Therefore, it would be foolhardy for anyone to try to break up the group. The whole is greater than the sum of its parts, and to dismantle it, for whatever reasons of the market, would be short-sighted and potentially dangerous for people right across the industrial areas of north Britain.
The change in the demand for defence equipment is creating problems for the defence procurement industry. It has already resulted in a dramatic loss of jobs. In 1979–80, the armaments industry employed 580,000 people. The last time that figures were published in the defence estimates, three years ago, that had fallen to 465,000. It is common knowledge that all firms engaged in defence activity are looking for civilian markets for future work.
We hope that the Secretary of State will consider the establishment of an arms conversion agency, which would help those firms in the defence industry that wanted to —there would be no compulsion—to move into new markets, by way of grants, training, and advice on restructuring and markets. The manufacturing base of the United Kingdom is far too narrow. The decline in demand for defence products offers us a chance to broaden our base and to make use of some of the most highly trained and best equipped sections of our work force.
The impact of the decline in defence expenditure is not confined to industry, but extends to the armed forces. While it is true that the Government have kept faith with the pay procedures that Fred Mulley, the last Labour Defence Minister, introduced, they have consistently ignored the need to improve living conditions and accommodation. I am sure that hon. Members will agree, because many have argued for it, that assistance must be given to armed personnel to enable them to improve their living conditions and to purchase accommodation for when they leave the armed services, so that they have a


place in the housing market. That is a lot more difficult and expensive than it was the last time that such a scheme was discussed, if only because of the interest rate hike.
We owe our armed services personnel a great debt. When they volunteer to serve, they give up a great deal and the financial recompense that we make them should reflect the level of the sacrifice. We know that recruitment will become more difficult as the demographic changes that are already under way become more pronounced. We support much of the tail-to-teeth approach adopted by the Government.
I have spoken to the Secretary of State about the implications of the Deal bombing and the murders in Germany. We deplore them.

Mr. Richard Holt: Will the hon. Gentleman give way?

Mr. O'Neill: No, I will not. I want to get this in in one piece because it is important.

Mr. Holt: Will the hon. Gentleman give way while he is still dealing with terms and conditions?

Mr. O'Neill: No, I will not.
The implications of the Deal bombing and the murders in Germany are such that we will not try to make political capital out of these events. We resent the allegations made, in the heat of a conference speech, by the Prime Minister, reading from a press release.

Mr. Tom King: No.

Mr. O'Neill: Yes. The right hon. Gentleman may wish to check against delivery, but the press release said that some in the Labour party were trying to make political capital out of these deaths. We resent that. We deplore these deaths. They are the work of ruthless fanatics with whom no democrat can have common cause. Those hon. Members who seek to consort with them or their allies deserve our contempt. The Labour Opposition join all who seek to console the grieving and give our full support to those who are pursuing these despicable murderers.
These tragedies have underlined the problems, especially for the British Army of the Rhine, of making every base and military establishment secure. Our troops in West Germany are there for long periods, so it is desirable that their families are able to stay with them in an environment that strikes the right balance between military and civilian life.
Things are different in the United Kingdom. There are no soft targets. The atrocity at Deal might have been avoided if, for example, fencing had been constructed on time. The ifs are endless. The presence of some private security firms at gates and on perimeter duty gives a clear sign to terrorists that part of the security is the responsibility of people who do not have access to arms, and who have only a minimum of training and often only the slimmest of commitments to the job.
The desire to free service personnel for more important and satisfying tasks commensurate with their training is understandable. However, if the work were undertaken by firms that operate proper vetting procedures, pay decent wages, take time to train their staff and can retain them, then their employees could undertake certain duties. However, I am not sure whether it would be as financially attractive for such firms to tender. In the discussions that some of my colleagues in the trade union movement had

last week with the Under-Secretary—I have a copy of the outline of the minutes taken by the trade union side— it became apparent that a review was going on.
We recognise that on some contracts that are still in the pipeline, the Government have given commercial undertakings. I hope that we can ensure that no more of these cheapjack firms will be hired and that, when people are sacked from one Department of the Civil Service, they do not reappear in the employ of another some time later.

Mr. Keith Mans: Will the hon. Gentleman give way?

Mr. O'Neill: We also recognise the Government's desire to control defence expenditure and reduce it where possible, and that desire is shared by all hon. Members. However, we deplore the piecemeal, penny-pinching manner in which they approach it. Morale in the service suffers, and the Civil Service and the Ministry of Defence are in constant turmoil. The defence industries feel manipulated by competitive tendering a way that was never intended. The Government are trying to do too much with limited resources. That is why we are calling for a full defence review—not one held over the weekend and reported only in the Daily Telegraph, but one that will take as its starting point our commitments.
We need a proper assessment of what is happening with the Trident system. This can incorporate the study by Sir Francis Toombes into the reasons why we can barely construct the facility for the Trident warheads, let alone staff it and produce them. We need to know what the prospects are for the D5 rocket and whether congressional funding for it will be confirmed. What will be the cost consideration for Britain, about which our ambassador in Washington referred in Jane's Defence Weekly last week?
What is the status of the stories about the vulnerability of nuclear boats to satellite radar? Is it true, or is it merely a piece of United States inter-service black propaganda? The House and the country are entitled to clearer and more explicit answers than the ones given, or than I have been given by the Secretary of State in a letter.

Mr. Mans: Will the hon. Gentleman give way?

Mr. O'Neill: The next Labour Government will accept the responsibilities, both financial and strategic, of inheriting the Trident programme. We shall keep and deploy our nuclear weapons in accordance with Alliance decisions. We shall work with the United States and the Soviet Union to secure a further reduction in the world nuclear arsenals. We shall participate in whatever talks are available to secure a complete ban on nuclear testing, to widen and strengthen the case for non-proliferation by showing that the existing nuclear powers will use their best endeavours to reduce and eventually eliminate our nuclear arsenals. We hope that the Government will subscribe to this approach, which we know is favoured by Washington and Moscow.
Our commitment to BAOR will be required to change as a consequence of the conventional forces in Europe talks in Vienna. The review must look at the prospects for force restructuring and for changes in military doctrine, with all the technical and equipment consequences that will follow. The House should be under no illusion. Britain, and only Britain, opposes the kind of disarmament that is on offer in Vienna. We know of the Government's deep-seated opposition to arms control in


the air, but rather than restrict and obstruct it, we should be exploring ways in which the deployment of the new stand-off missiles can be controlled. We are neither seeking British deployment of these weapons nor prepared to countenance their clandestine deployment in Europe by the United States. Let us talk to the Americans and get a clear and public understanding of what the United States air bases will be used for and what will be deployed there.
One of the great tragedies is that the impetus for arms control which exists on the continent does not drive the search for maritime arms control in the Atlantic. There must be an urgent review to examine some of the Soviet offers in that area. The forward deployment of Polaris with the attendant ships and aircraft contributes to a provocative maritime strategy.
There are a number of confidence and security-building measures that could be explored. For example, there is notification of movements, notification of exercises along the Stockholm lines and the possibility of challenge inspection.
We have also to assess the significance of protecting——

Mr. Mans: Will the hon. Gentleman give way?

Mr. O'Neill: Madam Deputy Speaker, this individual has endeavoured over the past quarter of an hour to interrupt my speech on a number of issues which bear no relationship to each other. I do not wish, therefore, to have him intervene in my speech. I ask you, Madam Deputy Speaker, to keep him in his seat.
There are a number of confidence and security-building measures that we could undertake. A degree of interest and commitment from Britain would transform the nature of the NATO debate. Apart from Norway and ourselves, virtually no other country, apart from the United States, takes very much interest in maritime matters in the high northern waters.
We must assess the significance of protecting sea lines of communication. If the CFE agreement goes the way that we all hope it will, the need for back-up support assumes new significance, and the case for a surface fleet will be raised again. I doubt whether, at the present rate of ordering, 35 ships could do the job.
The defence of the United Kingdom and of the home base will continue to be our closest concern. The problems of building up reserve forces were referred to by the Secretary of State. We support him in his endeavours to get as many employers as possible to agree to support the reserve forces. We are talking of an essential part of the defence of the United Kingdom. We want to ensure that all our forces, reserve and regular, are properly trained and equipped and that they are Britain's highest priority. Out-of-area responsibilities must be continually reassessed. For example, we must determine what the size of the Armilla patrol should be. British forces and ships must be kept out there no longer than is necessary.
We have a two-day debate in prospect, but the areas that have been covered by the Secretary of State and myself could justify a far longer one. It is clear that there is confusion and muddle in the Cabinet and in the Ministry of Defence. The British Government are at odds with the rest of NATO on major issues underlying strategy, equipment, deployment and the scope and pace of

disarmament. That is bad enough, but even worse is that that confusion is reflected in the defence industries, in which some great firms are teetering on the brink of bankruptcy because of the delay, muddle and expense that stems from the process of competitive tendering. There are other firms which do not know when they could fall prey to foreign takeovers. They do not know what, if anything, the Government will do to construct a credible strategy for our defence economy.
Last but not least, what future is there for our armed forces when they see their European counterparts with better equipment, better living conditions and a clearer sense of purpose in their military role? These young men and women are sick and tired of being told that they are the best in the world by a Government whose incompetence, short-sightedness and cheese-paring all too often provide inadequate means to carry out tasks that the rest of the allies no longer think are necessary. Eight years after the Nott report, Reykjavik, Stockholm and the INF, with the prospect of further disarmament to come, we need a review of Britain's role in the world and its future contribution to peace and disarmament. That is why I urge my right hon. and hon. Friends to join me in supporting the amendment.

Mr. Michael Mates: I am sure that the entire House will wish to congratulate the hon. Member for Clackmannan (Mr. O'Neill) on his remarks about the atrocity at Deal. It must be healthy that there is outright condemnation of the horrors that were experienced there from both sides of the House. The House is the better for both sides being able to agree that such matters should be condemned.
I congratulate the hon. Member for Clackmannan also on the way in which he has danced lightly through the minefield of his party's policy. He did so with his usual good nature and good humour. He made what I reckoned to be an impossible job just a very difficult one. There is a serious aspect of what the hon. Gentleman said, however, which I am sure my right hon. and hon. Friends will want to consider. He criticised the Government's defence policy. He argued that the Government have not gone far enough, have not done enough and have not maintained the real rate of increase on the basis of the inflation that was expected but which has not materialised. If that was not an exercise in cynical opposition, it was an outline of what the hon. Gentleman is committing his party to if and when it should ever form a Government. His words, criticisms and charges need to be closely examined. Questions need to be asked in the greatest possible detail so that the hon. Gentleman can sustain his claim that a Labour Government will do more for Britain's defence than the present Government have done.
I am glad to have the chance of congratulating my right hon. Friend the Member for Bridgwater (Mr. King) on his appointment as Secretary of State for Defence. I look forward to working with him in the years to come. It is appropriate in a defence debate that we should thank him too for his work in Northern Ireland. I do not refer only to the politics of that God-forsaken part of our kingdom. I am mindful of the enormously staunch way in which he supported our forces during his four years as Secretary of State for Northern Ireland. That was of enormous encouragement to all those I know who served in the Army


in Northern Ireland and to the services generally. The morale of those in the services depends on the staunch support of political leaders. They could have had no stronger ally than my right hon. Friend, and the House should know that.
I am grateful to my right hon. Friend for his kind remarks about the Select Committee on Defence. I am sure that all my colleagues who are members of the Committee will look forward to meeting him, to having him appear before us and to working with him in the years to come. Of course, we have different jobs to do. We have different responsibilities and our aims are not always the same. My right hon. Friend has to defend the Government's policy while members of the Select Committee have to examine impartially, as I hope we do, all the problems of defence in terms of accountability to the House. This means that there will always be a constructive tension between us. If that is handled with good nature, as it has been in the past, I do not see it as other than a thoroughly healthy irritant to the democratic process.
A defence debate is a time when we who have the good fortune to serve on the Select Committee on Defence can have our wares set out and examined. I hope that the House will have noticed the resumé of our activities which appears on the Order Paper. It sets out 10 of the reports which the Committee has produced this Session. That list does not include the report on the Brigade of Gurkhas, which was attached to the Army debate. We have produced 11 reports and we expect to produce three more before prorogation. The production of these reports is a tremendous tribute to my Committee colleagues for their hard work and their largely bipartisan approach to the Committee's work. With the membership of the hon. Member for Woolwich (Mr. Cartwright), I should say that the approach is tripartisan. The hon. Gentleman's expert contributions are greatly welcomed. The Committee has worked hard and I am the first to acknowledge to all my colleagues how grateful I am for their help.
I wish to make one other acknowledgement. It is an unusual one, but I hope that it is not out of order. I wish to thank a servant of the House, Mr. Robert Rogers, for his work during the six years that he has been the Clerk of the Select Committee on Defence. His work has been unstinting and his loyalty has been tremendous. He has contributed enormously to such effectiveness as we have been able to show to the House in the depth of detail in the reports that we have submitted. When one of the servants of the House does such sterling work, it is perhaps not out of place to mention him by name.
The Select Committee on Defence is engaged on two major inquiries. The first one is on military low flying, a subject in which there is a great deal of interest expressed both inside the House and outside. The second inquiry is into the reliability and maintainability of defence equipment. We hope that we shall have substantially completed these inquiries by the Christmas recess. We shall then continue our item-by-item examination of major procurement programmes. We shall examine next year Rapier, the JP233, Blue Vixen and the multiple-launch rocket system. In the context of what has been said by my right hon. Friend the Secretary of State and the hon. Member for Clackmannan, we decided this morning that we wanted to pursue further our inquiry into the physical security of military installations, a subject which we examined in some detail a few years ago.
If hon. Members read the list that is set out in the Order Paper, they will note that we have increased the number of subjects in which we are now making annual progress reports. We attach special importance to our annual review of the defence White Paper. but we are also taking an annual look at Trident, the Royal Navy's surface fleet and the availability of merchant shipping for defence purposes. I hope that the House finds these annual updates useful, because they reflect the anxiety felt by hon. Members on both sides of the Committee about those problems, which do not simply go away because they have been considered once. They need to be considered more often so that we can try to identify trends and report them to the House, as well as merely giving the snapshot view at a particular time.
I shall allow the Committee's other reports to speak for themselves. I want to pick out one theme from our report on this year's "Statement on the Defence Estimates', and that is the subject of personnel covered in part III. Both retention and recruitment, especially of those with key skills expensively taught out of public funds, are showing worrying trends. There is growing disquiet not only about overstretch because of increasing workloads, but about the turbulence that those shortages cause in domestic life. Postings and separations have always been part of the service career, but in an increasingly competitive labour market they may tip the balance towards personnel seeking a career in civilian life; yet we have spent thousands, and sometimes millions of pounds training them to serve the armed forces. The demographic trough —or the birth/dearth as I have heard it called—will be a major factor in personnel policy during the coming years. My colleagues and I will be studying closely the plans that my right hon. Friend has to offset those trends.
It is vital that we retain the high-quality personnel that we need so much. We rightly focus upon value for money, but that should not blind us to the need to think about money for value. We should not only pay tribute to the services and their civilian support, we should ensure that conditions of service, as well as remuneration, do no t disadvantage them in a more competitive labour market. That is of key importance not only to the services, but to the civilian infrastructure, as is shown in our second report of the session on the truly alarming staffing situation in the procurement executive.
Although my right hon. Friend said that this was a good time to hold a defence debate, the Committee is disappointed that, once again, it is taking place after the summer recess, so we are debating a document that was published almost six months ago. The Committee finds it difficult to accept such a delay because of the annual rush in the summer to produce its report. The Committee is, given four weeks to do so by the Leader of the House, who then tells us that he cannot guarantee a day more. Therefore, at not inconsiderable expense to the Exchequer, the reports are printed urgently.
To have the matter put off until the autumn takes away the urgency of the inquiry and the freshness of the debate —and not only on our report, but on the Government's White Paper. I am also aware that our demand to conduct the inquiry in a short time places extra burdens on the Ministry of Defence. I hope that my right hon. Friend will help me this year and try to achieve a timetable that is comfortable for us all and that enables the debate to have the freshness that it lacks after the long summer recess.
I wish now to speak for myself as a Back Bencher and to return to a subject upon which I touched during the Army debate. It is the way that the community charge is to be introduced in the armed forces. Before my hon. Friends groan, I assure them that I do not intend to cover old ground. I accept that the poll tax will be introduced, but I beg my right hon. and hon. Friends to think about what will happen in the armed forces. My hon. Friend the Member for Romford (Mr. Neubert), who was the Under-Secretary of State for the Armed Forces at the time of the Army debate, undertook to write to me and clarify matters. He did write, but far from clarifying matters, he increased my alarm. The Government's argument is the standard argument on which they have introduced the charge, and which I accept—that they want to increase the direct accountability of local authorities to a wider range of the population. That would be acceptable if the argument could embrace the armed forces, but I hope to show that, in many cases, it cannot.
In his letter, my hon. Friend the Member for Romford said:
To remove the entire body of the Armed Forces from this regime would directly cut across the important link between what individuals pay and the level of local services they are able to enjoy.
My hon. Friend's letter has been placed in the Library, so some hon. Members may have already seen it. He went on to explain how the system would be introduced, and said that there would be a ceiling beyond which service men would not be charged in high-rated areas, although why that should be £50 a year more than the average I do not know.
I telephoned my hon. Friend's office and asked how that would operate and how he would work out the average charge. My hon. Friend's office said that they would add up all the community charges payable in all the districts of the land so that they could work out the average. A return will have to be made of every single and married soldier's community charge, wherever he happens to be and for whatever part of the year he happens to be there. As an exercise in bureaucracy that will be extremely difficult, although such things can be done. But done for what? It is so that the tenet of accountability will still apply.
The Government realise that that will create problems —for example, with the temporary posting of service men. Yet even more extraordinary is the fact that there are different rules for married service men and for single service men, and those rules apply in quite different ways. When a married service man is sent away from his station the community charge in the new place will not be payable if the tour lasts for less than six months, yet single service men posted away from their station will come off their home community charge register after 60 days.
How can it be that, for example, if a regiment is sent to Northern Ireland for four or five months the married members of the regiment will be treated differently from the single members? Some will come off their home community charge registers after 60 days; others will not be eligible for some months. That does not make sense. They are all in the same boat, having been sent there to do the same job. If there is to be a financial difference in the

way they are treated for the purposes of the community charge—I am not suggesting that anyone should get out of paying it—that will cause dissent.
Indeed, there is currently cause for dissent in Scotland, where some members of the armed forces are paying the community charge as well as rates. They have left their families in England and gone to serve in Scotland, where the registration officer is registering them as liable for the community charge although they are still paying rates at home. Added to that is the problem of the way in which the system is being perceived by those serving in Scotland because the senior officers are hundreds of pounds better off while the junior ranks are much worse off. Although that is an effect of the community charge which is part of the general debate, it has always been a tenet of the way in which the services conduct themselves that, as far as is possible, everyone is treated the same.
There is a simple solution. We have lived through the complexities of the rating system for 50 and more years. and we can do the same under the community charge. No service man should be exempt from it; each must pay his due. However, they should each pay an average for all three services, which could be collected in the same way as the rates are collected now. Currently a married service man pays a rates element in his rent, which is collected and passed on for local government expenditure. The same applies to a single service man. Why change a perfectly good system? Everybody thinks it fair.
In my constituency there are three major training schools where people come and go. Those responsible within those establishments are bending over backwards to tell the local authority who comes one week and who goes another week in preparation for next April. What an unnecessary complication when there is a perfectly fair and just method of charging service men under the community charge so that they make their contribution to local government in the way that they have been doing.
I beg my right hon. Friend to look at that matter again. The potential muddle greatly outweighs any benefit that may come from a system based on local accountability. It is desirable for all service men to feel part of the local government and the national process, but I am afraid that that will never hapen. They will make their local affiliations where their homes are, the places from which they come, the places that they go home to for their leave and the places to which they retire, rather than the station in which they find themselves serving for six months or one, two or three years.
There are so many more complexities that I could have thrown at the Government if I had so wanted, but I want to make one fundamental point in the hope that the matter will be looked at again. If it is, as it nearly always is, the Treasury which is making difficulties, let it be told why a policy which, without fighting old battles, I can say has not been the most popular that the Conservative party has introduced in the 15 years that I have been a Member, would make a bad situation worse by upsetting the soldiers, sailors and airmen. They may always be grumbling, but if the system is fair, it can be ignored; if it is unfair, their grumble is genuine, and that does untold damage to the armed forces.

Mr. John McWilliam: It is always a pleasure to follow the hon. Member for Hampshire East (Mr. Mates), particularly since it gives me an opportunity to pay my tribute to the work that Robert Rogers has done as Clerk to the Select Committee on Defence. It is extremely useful to have someone who is as knowledgeable, cheerful and hard-working, and as willing to give advice, help and guidance, regardless of who asks for it, on a completely impartial basis.
It is always a pleasure to serve under the chairmanship of the hon. Member for Hampshire, East. As hon. Members can see from the number of reports that we have produced in the past few months, we have been extremely busy. However, there are irritants. It is irritating when the Ministry of Defence, for reasons of its own, becomes obstructive on perfectly legitimate questions about its policies and expenditure. It is irritating when witnesses insist on giving in private information which is not secret or classified. We are told that it is commercial, in confidence. When the information is given, one realises why—it is embarrassing. It is also irritating to be given classified evidence in private only to see on our television screens the next morning a complete exposition of what it was, including close-up photographs of the weapon system, which is usually a Soviet one, a complete analysis of its capabilities and details of what is being done to overcome it. We often get more information that way than we are given. That is extremely irritating and I wish that the MOD would stop it.
Equally, when the MOD sends witnesses to us, I wish that it would send them in a helpful state of mind. It is irritating to have able and intelligent individuals standing before us playing a straight bat and ending up looking positively foolish. It is even more embarrassing when we have to abandon evidence sessions and recall witnesses and a Minister, who has to remain simply because, during the first session, his civil servants would not answer questions. Those are my gripes.
I too welcome the right hon. Member for Bridgwater (Mr. King) to the Dispatch Box, but I am disappointed in what he had to' say. I am disappointed because he was complacent. He did not seem to be reflecting the challenges and opportunities which now exist for him—opportunities which have not existed for a long time.
It is all very well for him to claim that the tensions within eastern Europe and the Soviet Union increase the threat to Britain. They do not. As far as I am aware, the independent republics of the Soviet Union are not in a state of war, or undeclared war, with the United Kingdom or any of our NATO allies. As far as I am aware, they make no territorial claims upon the territories of any of our NATO allies. As far as I am aware, all that they want, and all that they are trying to get, is a measure of individual freedom and responsibility and to be able to enjoy choice and a range of goods which consumers in western Europe have been able to enjoy for a number of years. It is the combination of those two pressures which has brought about the changes. President Gorbachev has come to the negotiating table with real offers that have to be looked at seriously.
But there are other pressures, which the Secretary of State was careful not to mention, such as those in the United States. Over the next five years, because of decisions taken by Congress and the Senate, the United

States will have to reduce its military expenditure by 20 per cent. Such pressures will have serious implications for the deployment of United States' resources within Europe, quite apart from the burden-sharing argument which some people have introduced. I do not believe that we have anything to fear from the burden-sharing argument. Any analysis of our commitment to NATO and to the Alliance will show that we play a full and serious part.
However, I am disappointed that, as my hon. Friend the Member for Clackmannan (Mr. O'Neill) has said, we have begun to crack a bit at the seams. We have shown real weaknesses in the one area that is of most importance to ourselves and to Europe, and that is the surface fleet of escorts, frigates and destroyers. We can forget the figures in the "Statement on the Defence Estimates". They are wrong. At the last count in June, of the 47 ships that are supposed to exist, 33 destroyers and frigates were fully operational and eight were available at short notice. That makes 41. Of the 33 that were fully operational, taking into account the commitment to the Armilla patrol, the Falklands, the West Indies and the additional commitment to help preventing drug smuggling and all the other commitments that we cannot discuss, the number of ships which on any day could be committed to NATO is insignificantly fewer than 30.
The number of ships that we are supposed to he able to commit to NATO is classified; I am not allowed to say. But I can say that the figure that I have quoted is significantly below what we are supposed to be able to declare to NATO on category A—that is, at virtually no notice.
I notice that in the "Statement on the Defence Estimates" the Minister has stopped trying to hide behind the claim of maintaining a surface fleet of about 50 ships. That fiction no longer holds. It is no good the Under-Secretary of State for Defence Procurement shaking his head. That fiction has been presented to us for four years. There can be no argument because the Select Committee report named the ships; any hon. Member can count them. That is a significant failure on the part of the Government.
My hon. Friend the Member for Clackmannen mentioned manpower, as did the hon. Member for Hampshire, East. The Secretary of State was complacent. The shortfalls are worse than they appear and they will get much worse. When we put it to the Ministry of Defence that we should perhaps maintain the Gurkhas, as constituted, to make up that shortfall, the Ministry of Defence reacted by cutting their numbers in half. It has not yet told us how that is to be done, or about the support units, or about proportions, or about where the Gurkhas will be based. All that we know is that their numbers will be cut in half, and that does not make sense out of the context of a defence review. We should have a review of our commitments to determine what we have in the way of assets and responsibilities and then to allocate them according to the review—but this is a defence review by stealth. Who gets cheese-pared depends on who happens to be flavour of the month. That bears no relation to the commitment required of the large number of men and women who serve in our forces, and it must ultimately lead to some loss of morale.
The Secretary of State was even more complacent about the Procurement Executive. We rely on civil servants to ensure that we are getting value for money and that contracts and specifications are properly drawn up and


adhered to. Administrative assistants—the basic clerical grade—in London and the south-east are 56·7 per cent. below target. It is their job to shift paper around and to do filing, and if they are not doing that work others must be —people who are being paid much more money to perform other functions. These targets are not the agreed manpower complements; they relate to what the Treasury says should be spent. They are not based on the work study analysis of the number of man hours needed to do these jobs.
Scientific staff are 17 per cent. below target in the Land Systems Executive and about 21 per cent. below target in the Air Systems Executive, especially in electrical and electronic specialities. No wonder there are scandals and gold-plated contracts and £300 spanners. A little urgency and consideration should have been devoted to this problem when we pointed it out. We did a great deal of work on the report. I understand the Ministry's point of view that this is a Treasury problem. Nevertheless, what is happening shows that the Treasury is throwing good money after bad. It is trying to save money by getting rid of the posts of people whose job it is to save money. That might be all right for short-term accountancy, but it is not good for the quality and reliability of equipment which our armed forces have to use, and it is certainly not good sense for the taxpayer who must foot the bill. This degree of complacency cannot be tolerated.
I am also worried about business appointments. High-ranking members of the armed forces and high-ranking civil servants walk out of the door and into well-paid jobs with defence manufacturers shortly afterwards. There is supposed to be a review procedure to look after that, but I have looked carefully at the evidence from the Ministry of Defence and I am not convinced. I am not saying that impropriety is taking place. I say that the system is not transparent enough to enable the House to assure itself that no impropriety has taken place.

Mr. Mates: The hon. Gentleman will want to remember, too, that not only high-ranking officers but those in middle management—those at the coal face of procurement projects—who do not come under the auspices of the Carlisle committee and who may move straight across from one area to the other may be involved in much more than meets the eye. It would be wrong to nominate for castigation only those of two stars and above.

Mr. McWilliam: The hon. Gentleman is right to correct me; I was coming to that point. I was going to explain that the people whom we can least afford to lose are generally fairly young married people with young children. Their Civil Service salaries are not enough and they possess good scientific qualifications. They often find themselves at the sharp end of a specification or a final requirement. So there are two causes for anxiety: possible impropriety, and the loss of our ability to ensure that we are spending our money wisely.
I sincerely ask the Minister to look into this again. It is not good enough for the Government to continue their present policy. That could only be described as scandalous and unworthy of support. I hope that the Minister will give us some assurance today that the present obdurate attitude will change. I hope that he will come to the Select

Committee and discuss more openness with us. We are quite prepared to deal with some of these issues in confidence, but the House must be able to assure itself that the public money which we vote—this is not Government money—is properly spent.
I am greatly disappointed. The Government have had the opportunity in the past 12 months, because of the changes in the conventional force talks and strategic arms talks, to make a positive contribution. They have not done so, or have done so unwillingly. They have been dragged kicking and screaming into line with our NATO allies.
I know that my party policy is that we will continue with Trident and deploy it, but the game has changed. Trident is vastly expensive and unnecessary, and represents a huge increase in our ability to deliver strategic weapons. It is widely believed in the United States and the Soviet Union that the strategic arms reduction talks will succeed. If they do, the sea-launched ballistic missile capability of the United States will be reduced, and anyone who thinks that the Soviet Union or the United States will happily allow Britain to acquire 25 per cent. of the United States' sea-launched capability is living in cloud-cuckoo-land. The sooner we pitch our weapons into the negotiations the better.

Dr. Alan Glyn: It is a great privilege to follow two members of the Select Committee, both of whom, especially its chairman, have contributed greatly to the defence estimates.
I want to concentrate on the changing relationship between NATO and the Warsaw pact which has resulted, as my right hon. Friend the Secretary of State said, from the changes in Europe that we have just witnessed. In a defence debate—year ago—last October—I said that there had been a change in the Soviet Union. But now the situation is completely different, as we have the actual breakaway. Not only are there changes in the Soviet Union but large nations are breaking away from Communism. That must alter the strategic line of defence between NATO and the Warsaw pact.
Paragraphs 46–49 will have to be revised, as there are changes not only in the Baltic states but in Poland and Hungary and their military contribution. As a result the Warsaw pact's line of defence has been altered and the Soviet Government can no longer rely on those allies. Although Czechoslovakia, Bulgaria and Romania prob-ably will remain in the pact, it is doubtful whether the others could be relied upon. I do not think that that is of great disadvantage to the Soviet Union. It is better to know that some countries are not allies than to have unreliable allies. I do not think that it alters the Soviet Union's position, but it must alter our line of defence.
As my right hon. Friend the Secretary of State said, the Soviets are rearming rapidly. They are producing better tanks and they still have overwhelming superiority. The real danger and the real challenge would arise if Germany were to reunite, as that would alter the whole concept of the Warsaw pact and NATO. We do not know whether that will happen, but if it does, I humbly suggest that the whole of our defence policy would have to be altered and our alignment would have to change.
My right hon. Friend the Secretary of State, whom I failed to congratulate at the beginning of my speech, mentioned reserves. We have to have reserves. An


important source of reserves would be an increase in the use of women in the forces, which is mentioned in paragraph 516 of the defence estimates, a policy which the Chief of the Defence Staff, agrees. Now that war is not so reliant on physical combat there are many roles which women could take and thereby free men in the territorial and regular armies.
The hon. Member for Blaydon (Mr. McWilliam) mentioned the possible reduction in the contribution by the United States to NATO. Although, under article 223, the EEC is not allowed to make a direct contribution, its contribution could be increased, particularly in efforts to make sure that we standardise our equipment within NATO. The EEC is not supposed to contribute to it, but I do not see any reason why it should have the benefit of defence if it does not pay for it. The removal of the United States forces would create a great vacuum and Europe would be compelled to fill it.
May I also thank my right hon. Friend for his start on the rebuilding of Victoria barracks, Windsor.
Finally, these changes in Europe are profound and as the hon. Member for Blaydon said, they stem from people's desire to choose a decent standard of living. We should not do anything to stop them. But at the same time we have to realise that we want disarmament and there is not a single person in the House or outside who does not want genuine disarmament, but we must not be blinded by recent events. We know that the Soviet Union is rearming at a fast pace. As my right hon. Friend said, since Gorbachev came to power it is still rearming at a pace, and producing excellent tanks. We have to make sure that the interests of our nation are protected. Until a genuine disarmament can be achieved, there will still be the need for the nuclear deterrent.

Mr. Tony Benn: The hon. Member for Windsor and Maidenhead (Dr. Glyn) has brought the debate back to what it should be about—relating our defence policy and expenditure to the real situation in which we live. If we pass the estimates tomorrow, everybody in the country, man woman and child, will be taxed £371 to pay for the estimates that have been put before us.
I rise to put forward a view which I believe is now becoming more widely shared generally, not just at the Labour conference, although that has been mentioned. The change in the international situation, the economic situation at home and throughout the world and the number of unmet needs in our country point quite clearly to the desirability of diverting some money now spent on defence into meeting those needs. That view at least has to be addressed seriously.
I have heard Secretaries of State for Defence speak in the House for nearly 40 years and I have never heard a poorer speech than the one this afternoon. If the Secretary of State thinks that the pressure for civil liberties in Poland or Hungary, which Opposition Members have defended for years, has been produced because he has a Trident on hire purchase, he really does not understand what is happening. After war Communism, which in my opinion was sustained by the cold war longer than it otherwise would have been, people now want greater freedom. They also want what I am asking for—the reallocation of money from weapons to meet their needs.
I thought it was funny that the Secretary of State went back to the old story that Hitler came to power because the Labour party was against the pre-war Conservative Government, when we now know the degree of support that Chamberlain gave to Hitler's objectives, but I shall not go into that.

Mr. Brazier: Let me remind the right hon. Gentleman that in 1934, the Labour party, together with the then Liberal party, put before the House a motion condemning the Government on the ground that the level of defence expenditure then was wastefully high. Can I point out the parallels with the speech that he is making now?

Mr. Benn: The hon. Gentleman had better remember that the first time I came to the House was in 1937, when I was 12. I heard Churchill speak from the Conservative Benches and the Prime Minister was Neville Chamberlain. Neville Chamberlain supported Hitler's policies. Of course he did, because Hitler was anti-Communist at home and opposed the Bolsheviks. The hon. Gentleman should read the captured German Foreign Office documents. He would then take a very different view about who really supported Hitler. But I do not wish to go back to 1934, as I doubt whether the hon. Gentleman was alive then and I was very young.
We are being asked to commit more than £21 billion to defence in 1990–91–3·9 per cent. of our gross national product. We are the third largest exporter of weapons in the world. It would be naive of us to discuss defence without examining the commercial interest in defence. I asked the House of Commons Library to tell me what were the profits made by the major defence contractors and I was given the figures. The 11 top defence contractors in Britain—that is, those with contracts worth £100 million or more—make operating profits of £3,310 million. Nobody can tell me that that does not represent a very powerful commercial interest to maintain defence expenditure at its present level. We cannot be naive about these matters. There are economic systems on which the one in Britain in part depends, whose confidence and success depends on high defence expenditure.
One of the problems that the Conservative party has never really confronted is that, if the Russians were to reduce defence expenditure, they would be likely to do well out of it, but if we reduced defence expenditure we would create a hole in our economy precipitating problems that could not be met by a Government who do not believe in planning. That point of view is not new; it was put before the first world war about the arms manufacturers and their vested interests.

Mr. Mates: The hon. Gentleman makes an interesting point, but he has it the wrong way round. If Russia makes significant reductions in defence expenditure, it will be at far greater cost to its domestic economy, because much more of it is devoted to defence. Try cutting 20 per cent. of a country's gross domestic product and see how many men are put on the street out of work. They cannot all be employed in refrigerator factories.

Mr. Benn: The hon. Gentleman should turn his mint) back to 1945. How many people did we pull out o uniform? Two or 3 million. How many people did we pull out of the arms industry? Two or 3 million. Within 18 months, there had been a massive conversion from war to


peace, because it had been planned. If defence expenditure is reduced in a capitalist society, many of the problems that the hon. Gentleman describes occur.
Why is Gorbachev credible? The Russians made many disarmament proposals, but people always dismissed them as propaganda. Gorbachev is credible because he said, "I want to cut defence expenditure to improve the standard of living of the Russian people." People at home say, "We agree. We should like to do the same." The amendment that I tabled has not been called, but I think that I am allowed to read it. It says that this House
declines to accept the Defence Estimates; and believes that Britain should reduce its defence spending, initially to equal the average level of other Western European countries, and transfer the savings made to social and economic priorities including the National Health Service, pensions, housing, education and other vital services, the elimination of low pay and poverty, much needed investment in job creation and economic development, and the restructuring of Britain's crumbling infrastructure.
That is an argument. The Secretary of State said that Germany, Italy, France and Spain were now defenceless and that if the amendment were passed we would be defenceless. I do not know who wrote his brief—perhaps he did so himself—but to argue that, if Britain were to have the same defence expenditure as those countries, it would be defenceless is an absurdity that no one will take seriously.
I do not want to exaggerate the figures, but the Secretary of State said that if our defence spending were cut to the European average the figure of savings would be £5 billion. I am more cautious, because I believe that it may be between £3 billion and £4 billion. I do not want to spoil the case by exaggerating it, but we spend more than France and Germany on defence.
Conservative Members should also consider the example of Japan, which spends 1 per cent. of its GDP on defence. It they want to know why the Japanese economy is so strong, it is because it has poured investment into Japanese cars, videos, televisions and other electrical and electronic equipment. How can it be claimed that Japan is weak in the world? It is so strong that it is buying chunks of the American and British economy. Japan and Germany—Germany spends less on defence than we do but more than Japan—are in a powerful position.
I tried to discover what could be bought with the savings of £3 billion to £4 billion, which is less than the Secretary of State's figure. It is hard to estimate, but the House always tries to do its best. It would probably buy 120 hospitals, 64,000 houses or, for the benefit of Conservative Members, would enable a 2·5p cut in income tax. I am talking not about total defence expenditure but simply the difference between European expenditure and ours.
According to the United States Arms Control and Disarmament Agency, the world spends $1,000 billion a year on weapons—about £1 million a minute. If one looks at other comparable official figures to see whether we are getting our priorities right, one finds that, worldwide, 500 million people are suffering from malnutrition, 800 million people are living in absolute poverty, 14 million children are dying from hunger-related causes every year and 5 million children are dying of diarrhoea, which is a preventable disease.
Without addressing the arguments that have been put today, the Secretary of State launched into a party conference or hustings speech; he did not turn his mind to the argument. The argument is that big changes are happening in the world. There is no Soviet military threat, whatever view people take of the Soviet system. Members of what is sometimes called the Left of the Labour party were more critical of Stalinism than any other group in this country. When Russia attacked Hungary in 1956, hon. Members on the Left of the party and I wrote a letter to Pravda. It was published, and the Minister can look it up if he does not believe me. I led the Labour party delegation to the Soviet ambassador to protest about the invasion of Afghanistan. Conservative Members should not accuse us of supporting such a system.
But, as the hon. Member for Windsor and Maidenhead suggested, there is no evidence that the Russians intended to invade western Europe. I always believed that the pressure for change in the Soviet Union would result from the desire of the Soviet people for the civil liberties and democratic rights that we want in Britain. That is what has caused change, not the fact that the Secretary of State can wave a Trident that is on order, which he could not fire without Bush putting on his satellite communication system. Who does he think he is kidding?

Mr. McWilliam: It would not work.

Mr. Benn: Even if it did work, it would not go anywhere, which is what the Zircon story was about. The Secretary of State knows that as well as I do. I watched the Zircon film to discover what was secret about it. The Secretary of State and I know that it was secret because the permanent secretary to the Ministry of Defence said that Polaris was not an independent deterrent. That was what we did not want the Russians to know. The Russians and Americans have satellites, and there is nothing secret about the deterrent.
The fact is that we have never had an independent deterrent and my hon. Friend the Member for Blaydon (Mr. McWilliam) rightly said that Trident will be removed, not by the dangerous Left wingers of the Labour party, but by the Americans, when they do a deal with the Russians because they will not want even the pretence that a British Prime Minister has a weapon.
We must consider our economic position. Under varying Governments of various policies, there has been long-term neglect of our industrial investment. At no time has that been clearer than at present. Following the high interest rates of 1979, the current high interest rates and the waste of oil revenues, industry will be unable to sustain the standard of living of our people when the oil runs out. We have no choice but to redirect resources into industrial development, and the proposed economies in defence would be a part of that.
Any hon. Member of whatever party allegiance who travels around the country and meets his constituents is aware of the appalling stress on public services, such as our under-staffed hospitals, the fact that people must wait for treatment and the fact that there are breakdowns in essential public services because of under-investment. Any serious Government of any political persuasion that rationally examined the priorities of public expenditure would know that there are no grounds for this level of


defence expenditure. There is an urgent need to redirect resources into industrial development, and we must ensure that civil needs are met.
The old joke that we have the best defended dole queues in Europe is not far wrong. The amendment that I tabled receives a vague hint of approval from the official Opposition amendment. It says that the Labour party wants
to examine the allocation of resources which could be released for social and economic purposes".
I think that I can say that I have amplified and clarified what my hon. Friend the Member for Clackmannan (Mr. O'Neill) put before the House, and many people in Britain would like to see that done. That should not be attributed just to the Labour party conference, or to the votes of delegates at our conference, because people are ahead of the Government in their perception of what is possible.
In 1945, I returned as an RAF pilot who was too young to vote, but I campaigned in the 1945 election. The United Nations assembly met for the first time in Central hall, Westminster and Gladwyn Jebb was acting Secretary-General. At that time, there was a huge surge of hope among people that the wartime alliance with Russia would last. We believed that we would make sense of the Security Council, but those hopes were dashed for 40 years. Now they are coming back again.
We cannot live for ever with the legacy of Hitler's Europe divided by an iron curtain. We want a European security pact which brings the Hungarians and Poles together with us and, if Germany is reunited as the hon. Member for Windsor and Maidenhead suggested, heaven knows what policy changes might appear in Moscow, Washington, Paris and London. Let us look forward for a change instead of harking back to the totally false idea that the Soviet system changed in response to the fact that we had a nuclear weapon on hire purchase and bankrupted ourselves through defence expenditure. That is laughable. It is not true and no one but the Secretary of State believes it.
When people read the report of this debate, it will make sense only if people outside believe that those of us in this place understand what people outside already know—that the cold war is over. Everyone, both East and West, wants to spend money on peaceful development. However, Britain, because of its absolute obsession with the idea that it remains a semi-super-power, is dragging its feet in moving towards peace and is denying its people the industrial development and the public services that they need more than anything else.

Mr. Derek Conway: I have considerable sympathy with the right hon. Member for Chesterfield (Mr. Benn). He has expressed to the House tonight his obvious disappointment, that he is not writing the next Labour party manifesto. Conservative Members share his disappointment, because we wish that he was writing it. That would be very helpful.
The right hon. Member for Chesterfield has tried his best to help the Government by tabling his amendment and I tried to help him by urging Mr. Speaker to select the amendment for a Division tomorrow night. I wish that the House could have an opportunity to vote on the amendment to see where among Labour Members the true face of the Labour party lies. Does it lie with the hon.
Member for Clackmannan (Mr. O'Neill), who puts on a brave face, but with some little conviction, or does it lie in the motion carried during the Labour party conference?
Conservative Members are not interested in this issue purely for party political gain. This issue has an effect in many constituencies. As hon. Members will know, there is considerable interest in and allegiance to the armed forces in my constituency not least because it is the military headquarters for the west midlands. Thousands of Shrewsbury folk are employed in defence-related industries. Many of those people, thankfully not in their thousands but in their hundreds, support the Labour party. Many of them work in traditional industries and produce Labour councillors and Labour party activists. The workers at Perkins Engines manufacture an excellent tank engine for the Challenger main battle tank. After the Labour party conference, where could those poor souls have read that £5 billion was proposed to be slashed from the defence budget and that their jobs would be lost? Perhaps the Opposition Front-Bench spokesman can suggest a socially useful alternative for a production line producing main battle tank engines. The workers are scratching their heads.
The appearance of my right hon. Friend the Secretary of State for Defence at the Dispatch Box was very welcome not least because he shares with his predecessor a personal experience of the armed forces. I am particularly glad to see my right hon. Friend the Secretary of State at the Dispatch Box because he is a former Light Infantry man. I hope that his Army bias will be displayed in his decisions in future.
My right hon. Friend the Secretary of State referred to procurement and rightly said that his Ministry would try to encourage smaller businesses. We would not disagree with that, but the House must bear in mind that research and development involves an enormous cost and a great proportion of that enormous contribution—especially with the rightly more rigorous regime which the MOD now employs in procurement policy—means that large employers in my part of the world, like GKN, Sankey, Dowty and Perkins may have to carry enormous burdens. in their trading exercises to cover the cost of research and development. While we all agree with my right hon. Friend the Secretary of State that smaller businesses have a role to play in defence procurement, we should not forget the valuable contribution played by larger groups in terms of research and development to move us forward in arms procurement.
I was particularly glad to hear my right hon. Friend the Secretary of State scotch some of the myths put about, particularly by Opposition Members, about the smiling face of Mr. Gorbachev as he leads the Warsaw pact nations. Of course we must encourage but, as my right hon. Friend the Secretary of State says, we must be cautious. He was right to remind the House—as hopefully the country will note—that the Soviet Union is producing a new aircraft every day. It is not as if the Soviets have pulled down the shutters and said, "Let's talk with the Americans and back-pedal." They are producing a new main battle tank every day. To be honest, some of us would like to believe that some Soviet weaponry is archaic and absolute rubbish. That is not the case. While some of our NATO allies may still be using second world war equipment, the Soviet main battle tank is a very effective piece of kit.
The Soviets produce a nuclear submarine every 42 days and a non-nuclear sub every 28 days. There is no impression yet that the Soviet conventional war machine, which is already considerably greater than NATO's, is slowing down.
I was particularly glad that my right hon. Friend the Secretary of State referred to the Ulster Defence Regiment.

Mr. Andrew F. Bennett: Why does the United States not hold the hon. Gentleman's view? President Bush appears to suggest that an agreement on START negotiations could be signed in 1990. If the United States is convinced, why will the hon. Gentleman not at least give some credit to the Soviet Union for starting to move in the right direction?

Mr. Conway: Of course I give the Soviet Union credit for that, and we welcome it. Who wants to live in an age of nuclear proliferation? However, the Americans, like our NATO allies and ourselves, are not being blindfolded. The hon. Member for Denton and Reddish (Mr. Bennett) castigated my right hon. Friend the Prime Minister for supporting the deployment of cruise missiles, but we heard very little when the SS22s were deployed. Together with his friends in CND, he said, "But look, the Soviets have offered to pull the SS22s back behind the Urals." However, what use was that for a weapon with a range of 3,000 miles? We have heard enough of the fork-tongued exercises of Opposition Members. Caution, as my right hon. Friend the Secretary of State warned, is the way forward. We welcome and support new developments, but that does not mean that we follow blindly.
My right hon. Friend the Secretary of State referred to the Ulster Defence Regiment. I do not believe that our debate today and tomorrow is the correct forum to examine the difficulties and the criminal investigations that are being carried out at present. I am sure that the House would want to recognise that nine battalions of the UDR are employed in the Province. Last year, 33 service men were murdered in Ulster, 12 of whom were part-time UDR soldiers. A further 239 were injured.
I have often spoken in the House about my involvement with the Territorial Army. The 90,000 involved in the TA on the United Kingdom mainland is as nothing compared with the bravery of those who volunteer for part-time military service in the Province. I take my hat off to those people and I am not sure whether I would have the courage to do the same in those circumstances. Just because a few apples in the UDR have received bad publicity, I do not believe that we should write off that very effective regiment and its nine battalions as tarred with the same brush.
My right hon. Friend the Secretary of State visited the large-scale TA exercise held by 49 Brigade during the recess as part of its NATO training. I hope that he was taken by the enthusiasm displayed by those TA soldiers. It has long been my experience that often when a regular soldier is posted to a TA unit, he is a bit cynical and prepared for the worst. However, within a few months he is convinced by the enthusiasm and commitment of the part-time soldiers. I am sure that my right hon. Friend the Secretary of State found that.
My noble Friend Lord Ridley is the president of TAVRA, which promotes employer-awareness of the

motivation, initiative, leadership and self-discipline which employers can get for free by enabling employees to take part in the TA—currently involving 90,000 people—as an investment by British industry which will be well rewarded.
I shall dwell briefly on Regular Army recruitment problems, which are often commented upon by the press and by the Defence Select Committee and, I am sure, are a matter of considerable and frequent discussion within the Ministry. Some of the terms and conditions which apply to the armed services are starting to look a little archaic in today's scenario. I suspect that much of the premature retirement rate is related to marital pressures. These days, those who are attaining mid rank see their wives still expected to play an absolutely free part in the services, whereas the wives of their contemporaries in civilian life are at work and often earn substantial incomes. Service wives make a real sacrifice today, and we glibly forget it. Those who have achieved senior rank in the armed forces remember what their wives had to do in their day, and they shrug off the matter. I suspect that many of our young and able NCOs and officers are voting with their feet on this issue. A generation gap may have to be bridged politically if we are not to lose more and more future able generals.
On problems with conditions, I remind the House of the active role that my hon. Friend the Member for Canterbury (Mr. Brazier) has been playing in trying to stimulate service men's ability to buy their houses. I always find it slightly depressing that the second part of the estimates, which contains tables shows that the number of people in the armed forces who buy their own homes—particularly those in the Army—are so low. Obviously, the Navy and the Air Force have a much better rate, but in the Army the rate is still pathetically low. My hon. Friend's activities to try to push my right hon. Friend the Secretary of State and his colleagues to greater encouragement of home ownership deserve our greatest support.
We have read of the MARILYN programme within the Ministry of Defence and of the "Five-run-away-together" teams, which has had a glib response in some of the press, focusing our attention on the fact that, when people join the Army in particular, they would like to see one or two faces that they know from their own region. In that respect, if there is one legacy that the Labour party has left the Army and the regional system it is the abolition of the county regiments, which, in the long term, will prove to be a great mistake. That must not be compounded by actions to close regimental depots to try to get an all-arms melting pot training system, which may be favoured by some within the Ministry of Defence but which would be as bad as the abolition of county regiments. Equally, the selling off of local training areas would be another blow to the community ties that are important to maintain the regimental system.
In the Territorial Army, there has been a move to reintroduce geographical titles bracketed behind the names of regiments—they are very long and are not the way to do it. If we are to accept that, for recruiting purposes, it is essential to connect regiments with geography, proper geographical titles should stand.
It is interesting that in London there are about 14 soldiers per 10,000 people. In other areas such as Tyne and Wear, for example, there are about 52 soldiers per 10,000 people. On Merseyside there are about 55 soldiers per 10,000 people, and in Cumbria about 58 soldiers per


10,000 people. That differential is related not only to unemployment problems but to the strong geographical identification in those areas.
In my original service with the Royal Regiment, the Fusiliers, the old love of the Royal Northumberland Fusiliers never died. Fortunately, when the regiments were combined, the Fusiliers' hackle for the Royal Northumberland Fusiliers was maintained. Some local people, when they saw the Fusiliers marching actually believed that they were still the Royal Northumberland Fusiliers. To introduce it as a proper county regiment would be a definite way forward, and equally so for the Durham Light Infantry. Of course, there is still a Light Infantry battalion based in Durham—the seventh battalion, and an excellent battalion it is too. Who can possibly doubt the strength of local feeling that existed for the Durham Light Infantry and the benefits for regular recruitment if it still existed?
Despite some of the knocking that often takes place in defence debates, I am convinced—certainly from my constituency experience—that there is a great warmth in our communities for the armed forces. They are not seen as a sinister wing of Government, waiting to remove democracy, but are regarded as part of the community. In my constituency the Light Infantry, the Yeomanry and RAF at Shawbury play a full and welcome part in civic occasions. The House and the Ministry of Defence will regret the day when we take our armed forces from communities. If there is one message for my right hon. Friend, it is, "Please bring back the county regiments."

Mr. John Cartwright: As someone who also represents what has traditionally been a military town, I strongly endorse what the hon. Member for Shrewsbury and Atcham (Mr. Conway) said about the need to improve what we think of these days as the quality of life for service men and their families if we are to attract young people into the armed forces, and, even more important, to retain those whom we already have.
I shall concentrate my remarks on arms control and the implications for the NATO Alliance of what is happening and what may happen in arms control. Much of the White Paper has been overtaken by the dramatic events of the past six months. All hon. Members would welcome the fact that prospects for arms control have now totally changed. No longer is it a tedious business of shadow boxing, with one side aiming to wrong-foot the other in the eyes of the watching world. It is worth recalling that the mutual and balanced force reduction talks dragged on for 15 years—from 1973 to 1988—with little to show for them.
Against that background, the much wider negotiations on conventional forces in Europe, which started on only 9 March this year, have made breathtaking progress in the past six months. Agreement has already been reached on the six categories to be included in the negotiations and on the overall ceilings for two of them—tanks, and armoured troop carriers. There is agreement on the principle that no one nation on either side should have a disproportionate share of overall ceilings. There is also agreement on the need to limit forces stationed outside national borders. The parties to the talks have agreed also to aim at least for a phase 1 deal before the end of 1990.
Of course, there are some important disagreements as well. For example, there is no agreement on ceilings for

artillery, aircraft, helicopters or military manpower and there is yet no agreement on regional arrangements to be made within the Atlantic to the Urals area covered by the negotiations. There is also perfectly understandable Soviet concern, which was referred to by the Secretary of State, about the sheer scale of reductions which they will have to make in manpower, weaponry and military production in a short time. Given the problems of the Soviet economy, I can understand their worries about having to demobilise large numbers of service men and to switch substantial defence industries in a very short period.
A great deal remains to be done in the CFE negotiations. Some complex technical problems are yet to be resolved, but one has a great sense of optimism about the talks compared with what happened in the past. There is clearly now a political will on both sides to achieve an agreement. To a large extent, it stems from the changed attitude of the Soviet Union, and it is important to recognise that it has happened not just because of a change in Soviet leadership. I certainly accept that, at least partly, it is due to the fact that NATO has stuck fast to its dual-track approach—a willingness to negotiate, while maintaining an effective level of defence capability. The right hon. Member for Chesterfield (Mr. Benn) underlined the fact that the change is due also to the awful realisation on the part of the Soviet leadership that they had urgently to tackle their appalling economic problems and to meet the aspirations of the Soviet people.
It is worth recalling that the USSR's official budget deficit is now estimated at $160 billion, which is 9 per cent. of its gross national product. Its share of world trade is only 4 per cent. Its total hard currency income is now $24 billion, of which no less than $18 billion goes on servicing foreign debt. Of 1,200 items in the Soviet housewife's official shopping basket, only 200 are now widely available. It is estimated that $500 billion-worth of roubles are hoarded simply because there is nothing to spend them on. Several assessments are being made in the West about the possibilities of success for President Gorbachev's economic reforms. Even the best case scenario is likely to produce such a small increase in economic growth that there will be no significant improvement in the Soviet economy or, indeed, in the quality of life of Soviet citizens Against that background, the Soviet Union will clearly need massive assistance, advice, expertise and technological aid from the West if it is to achieve its objectives. The one thing that the Soviet Union can offer us in exchange for that assistance is security by removing the threat of military attack which has hung over western Europe for the past 40 years. That is the underlying basis of the. negotiations and it is why there are grounds for optimism about the eventual outcome.
Many people are already looking beyond the CFE to what might be the next steps in conventional arms reductions. The Supreme Allied Commander, Europe, General John Galvin, has already spoken about the possibility of further drastic reductions beyond the levels now being discussed at CFE. The former SACEUR, General Andrew Goodpaster, is among those arguing the case for a phased reduction by the mid-1990s to a level at least 50 per cent. below NATO's current deployments. They argue that such cuts are both practical and possible.
Those comments from perfectly prudent military sources, added to obvious improvements in super-power relationships, will have a substantial impact on public opinion in the West. They seem to have had some impact


already on some NATO Governments. Cuts in defence spending have already been announced by the Netherlands and Belgium specifically in anticipation of agreements likely to come from the CFE process. Other nations are discussing reducing the length of their military service or scaling down their defence efforts. It is hard to resist the judgment that some of us are giving in to the temptation to cash the dividends from an arms control agreement before the cheque is even in the bank. That is a dangerous process.
There is a pressing need for NATO to work out a co-ordinated, Alliance-wide approach to this problem. If we do not have such an approach the risk is that we shall indulge in an unseemly scramble, with individual nations seeking to reap the financial benefits of arms control by making unilateral cuts. If that process continued, we risk ending up with a fragmented, unco-ordinated, ineffective structure of defence in western Europe.
We must recognise that the pressure for defence cuts —again we are grateful to the right hon. Member for Chesterfield for underlining this point—will come from western public opinion, which sees a marked reduction in the perceived threat from the Soviet Union and is increasingly reluctant to pay for levels of defence that it no longer considers necessary.

Mr. David Martin: Is that not precisely what was being said about China, which was thought, if anything, to be ahead of the Soviet Union on reform? The events in Tiananmen square brought up short the argument that the British people no longer perceived a threat.

Mr. Cartwright: If the Soviet Union and Warsaw pact countries had reacted to the extraordinary developments in eastern Europe as the Chinese Government did in Tiananmen square, I would see the relevance of the hon. Gentleman's point, but as the tanks have not rolled into Warsaw, Budapest or East German cities, his point is not relevant.
The public in the West will see massive changes in the Soviet Union and in eastern Europe generally and will be increasingly reluctant to pay large sums for a level of defence which they, perhaps mistakenly, no longer perceive to be necessary. NATO must respond to that. The argument was put clearly in a paper produced for the North Atlantic Assembly by Ambassador Jonathan Dean, a former United States negotiator at the MBFR talks. He argued that NATO must
develop a concept which would have the prospect of obtaining the enduring support of western publics for financing NATO's remaining forces over a long period…A rationally argued proposal for deep cuts is preferable to an erosive piecemeal process of unilateral budget cuts in the NATO countries.
We need that approach.
I accept the case for some caution when we observe the extraordinary developments in eastern Europe. The Soviet Union is going through fundamental changes and as a result will be a much less predictable nation than it was in the days of the geriatric leadership. History suggests that, when empires break up, we experience a period of uncertainty. That may be what we now face in eastern Europe. Ethnic problems are bubbling up inside the Soviet

Union and there are tensions within and between the Warsaw pact members. These are all potentially destabilising factors.
Perhaps we should also recall the warning of Boris Yelstin—that President Gorbachev had a limited period in which to deliver the goods to the Soviet people, and that if he did not succeed there would be the risk of widespread internal problems. That underlines the sense of instability. Against that background, it makes absolute sense to negotiate balanced reductions, not to make unilateral cuts on the assumption that the Soviet Union and Warsaw pact will follow suit. More importantly NATO needs to harmonise its arms control objectives with its force planning. We must look at the structure of our forces to take full account of what is happening in the negotiations to ensure that what is left after the cuts makes sense in defence terms.
More fundamentally, we need to determine what level and type of defence we need to take account of the major changes taking place in East-West relations. That strengthened the case for reconsidering our defence on a more integrated European basis. All nations in western Europe share the same manpower problems and the same budget pressures. We are all aware of the prospect of reductions in US forces deployed in western Europe. We shall all have the problem of sharing out the arms control ceilings flowing from the CFE negotiations. To suggest that we can take an individual national approach to those problems does not make sense. It is about time that western Europe began to think collectively about its future defence needs.
I have no difficulty in accepting the argument that for the foreseeable future the security of western Europe depends on a mix of conventional and nuclear weapons, but there is room for debate about the make-up of that mix. If Soviet conventional forces are reduced, there will be no need for the present levels of sub-strategic nuclear warheads that NATO deploys in Europe. The future size and make-up of NATO's nuclear arsenal should be based on hard assessments of targeting needs and survivability. We should advance the concept of a minimum nuclear deterrent, recognising that it will be credible only if it is modern, effective and survivable.
We could deploy far fewer than NATO's present 4,000 warheads in western Europe, and a key element will be the tactical air-to-surface missiles to be deployed on NATO aircraft. The case for deploying a new generation of short-range surface-to-surface nuclear missiles strikes me as dubious. I cannot see any practical possibility of persuading the Federal Republic of Germany to deploy a follow-on to Lance, and I cannot see the point of dividing the Western Alliance by forcing through such a development. Unless we can achieve the concept of minimum nuclear deterrence, it will be more difficult to sustain existing public support for the retention of nuclear weapons as part of our deterrent capability.
We see the prospect of real success in arms control, but we must recognise that that success will bring new problems. There is a need for NATO and the Warsaw pact to accept a change in their role. They must be not only instruments of collective security but agents to manage the fundamental changes to much lower levels of arms deployment from the Atlantic to the Urals.
When making the case for appropriate levels of defence, we cannot rely on the old knee-jerk reactions of the cold


war. We must make a much more sophisticated case to our people if they are to support the levels of defence that we need in a fast-changing world.
We should also recognise that soldiers and weaponry are not the root of our problem. They are merely a manifestation of the mistrust between the two super-power blocs. We now have the prospect of a totally new relationship between ourselves in the West and the nations of the Warsaw pact. Those nations will be looking to the West for help because they have to accept the fact that their system has simply failed to deliver what their peoples want. The post-war period is now coming to an end and we are entering an era of great change. It is essential that the Western Alliance should redefine its defence needs to take full account of those changes.

7 pm

Mr. Jonathan Sayeed: It is a pleasure to follow the hon. Member for Woolwich (Mr. Cartwright), who is a valued colleague in the Select Committee on Defence. I hope that he will excuse me if I do not follow him, but embark on my own tour d'horizon. I sometimes feel that second-guessing Soviet intentions is a somewhat futile occupation. Kremlinology may well have been invented to make astrology respectable. However, whether or not that is the case, I intend to resist the temptation to Healey-hop around the hemisphere and will stick to three points—two about procurement, and one about personnel.
The lessons of the sinking of HMS Sheffield and the Atlantic Conveyor and the massive damage done to HMS Glamorgan—all ships that were unable to defend themselves against a French-built Exocet—are that we armed and protected Her Majesty's ships so that they could defend themselves against Soviet weapons systems, but not against weapons systems built by friendly powers. Consequently, we should have learned that the staff requirement should, whenever possible, take account of the weapons and defensive systems—and the develop-ments—not only of the Soviet forces, but also of friendly forces.
I wish that that had been the only example of where we had got it wrong, but sadly it was not. I bring another example to the attention of the House. It is referred to in the 11th report of the Select Committee on Defence and relates to the light anti-tank weapon for the 1980s, a shoulder-fired, unguided anti-tank weapon. Its full development started in 1977 and it came into production in 1987–10 years later. It entered service last year—five years late.
Paragraph 7 of the 11th report states:
The extensive time and cost overruns stem primarily from a re-assessment by MoD of the protection levels of Soviet armour and a complete re-appraisal of the weapon system performance requirement. This arose after the requirement had been specified and endorsed, the development programme had been planned, and work had begun. Its outcome was a change to the weapon performance requirement designed to increase the effectiveness of LAW 80 against thicker Soviet frontal armour and the re-definition of the development programme.
Paragraphs 31 and 32 then state:
Considerable advances have been made in recent years in the armour for the modern battle tank. One of the principal advances has been explosive reactive armour (ERA) which was patented in the West in 1974 and first appeared in service in 1982 fitted to Israeli Centurion and M60 tanks. It has been

reported that the Soviet Union has developed ERA with unexpected speed, and that since the early 1980s it has been fitted to large numbers of their tanks.
The General Staff Target for LAW 80 was issued in 1971 and full development commenced in 1977–78. The perfor-mance requirement is designed to counter thicker Soviet frontal armour and not ERA. It would seem therefore that LAW 80 will not be capable of penetrating the frontal arc of the latest Soviet tanks where this is protected by ERA".
I have no doubt that LAW80 is an excellent weapons system—indeed, the best in the world. However, it is years late and well over budget, and that is because the staff requirement of 1971 was based on a fallacy. It was based on an assumption that the Soviet Union would not develop its armour any further. However, we know that developments in the Soviet Union do not stand still. It was based on the assumption that what this country had developed in 1974—ERA—would not be available to the Soviets by 1983, the first projected date for bringing that weapons system into service. Frankly, that was just foolishness.
Although it will not always be possible to do so, I hope that, as far as is practicable, the Ministry of Defence will ensure that when a staff target is determined it allows not only for likely Soviet advances in weapons and defensive systems, but also for the developments made by friendly forces.
LAW80 crops up again in my second criticism of the procurement process, as does the vertically launched Sea Wolf. Hunting Engineering was the lead contractor for LAW80 and British Aerospace was the lead contractor for Sea Wolf, but both had Royal Ordnance as their main sub-contractor. Royal Ordnance was Hunting's sub-contractor for the rocket motor for LAW80 and BAE's sub-contractor for the boost motor for Sea Wolf. However, the contracts were different. Hunting's contract was initially set in 1977 on a cost-plus basis and was changed in 1983 to an incentive pricing basis.
On the other hand, we were told proudly by Ministers that British Aerospace's contract was on a fixed price basis. No doubt this is naive, but I always thought that a fixed price would not change. However,  got it wrong. A fixed price means a fixed price for the MOD, not for the taxpayer. For both Hunting's LAW80 and BAe's vertically launched Sea Wolf, because the sub-contractor was owned by the public—at that stage Royal Ordnance was still in the public sector—the public had to pay when the sub-contractor got it wrong.
I trust that when my right hon. and hon. Friends on the Treasury Bench again tell us that a contract has been let on a fixed or firm basis, they will ensure that they also tell the House whether any of the sub-contractors are owned by the public, because if they are, although the price may be fixed for the MOD, if things go wrong it will not necessarily be a fixed or firm price to the British public. It is wrong for the taxpayer to end up bailing out failure when we have been assured in the past that that will not happen.
I should like to make another short point before leaving the issue of procurement. I do not doubt the competence of my right hon. and hon. Friends, but I find it somewhat odd that the three Ministers who had anything to do with procurement—the Secretary of State, the Minister of State and the Under-Secretary of State—should have been moved from that Department at exactly the same time.
My last main point concerns personnel. We have heard much about the demographic time bomb, about


MARILYN and about the problems there will be in recruitment. All that is absolutely true. It is essential that we face those problems early and that we do something about them. However, there is another point, on which my hon. Friend the Member for Hampshire, East (Mr. Mates) touched, and that is the retention of personnel. At present, when a man asks to leave under premature voluntary retirement—PVR—he is interviewed by one of his senior officers and asked why he is going. He may give them frank reasons, but sometimes he may blame his wife and some of his real reasons may be rather different.
I suggest that my hon. Friend the Under-Secretary of State for the Armed Forces should consider the suggestion that, six months after a person has left under PVR or declined to re-engage, that person, or a sample of such people, should be interviewed by an organisation independent of the Ministry of Defence. The Ministry should then attempt to determine what actually prompted that person to leave and should attempt to remedy the defects that cause PVR or cause people to decline to re-engage, as far as that is possible.
I should also like the possibility of re-enlistment bonuses to be considered. As we well know, every year there is a shortfall in a number of specialisations, usually those for which it has cost the taxpayer hundreds of thousands of pounds to train men. It should be possible to undertake annually a cost-benefit analysis and to compare the cost of paying a re-enlistment bonus to all those eligible where there is a projected lack of personel in any one year against the cost of additional training and the cost of the shortfall. There could be published annually in Defence Council instructions a list of re-enlistment bonuses that might be paid for that year to certain specialisations. It costs a vast amount to train men and women. It is right that we should do so and continue to do so, but it is also right that we should do our best to retain within the services the skills that have cost the taxpayer so much. I hope that my hon. Friends will consider those points.
I listened carefully to the hon. Member for Clackmannan (Mr. O'Neill). At the end of his speech, I realised that the Labour party does not have a defence policy; it has a disarmament policy. It is a disarmament policy based essentially on surrendering everything for next to nothing. If the right hon. Member for Chesterfield (Mr. Benn) did not make that clear, the twisting and turning of the hon. Member for Clackmannan did.
Only one party can be trusted with the defence of this country, and that is the Conservative party, as it has shown time and again. I have no doubt that in two to three years' time the British public will demonstrate at the polls their trust in this Government and their defence policy.

Mr. Andrew F. Bennett: I find the remarks of the hon. Member for Bristol, East (Mr. Sayeed) amazing, when one considers the content of the speech by the Secretary of State today. He was introducing the estimates, which was a major opportunity to set out the Government's policy. What did he tell us? He told us that a new department of defence studies was to be established at London university and he then went on to attack the Labour party for debating the direction of our defence policy. There was no recognition that there needed to be a

change of policy and the development of a new strategy. The Secretary of State did not deal with the many problems that face our defences at present. He did not refer to any of the Select Committee reports except with a passing reference of gratitude to the Select Committee, perhaps for not asking too many awkward questions. If one looks down the list of points for us to debate today and the serious questions raised, one realises that he did not answer any of them.
The Secretary of State did not tell us what will happen to the Trident programme and whether it will come about. He did not deal even with the question of anti-tank weapons. However, his real failure was that he did not set out a strategy for disarmament or arms reduction for this country over the next 10 years. He said that it was far too soon to know whether the Soviet Union is really taking the process seriously and whether changes will come about. In defence, decisions have to be taken well in advance. We could have expected from the Government in a major speech such as today's that they would at least set out some tentative proposals on the way in which the Government are starting to think. We got none of that.
Clearly there is now a need for a major review of our whole defence strategy, as the Opposition Front Bench suggested. The key question was put by my right hon. Friend the Member for Chesterfield (Mr. Benn) when he asked how much we were prepared to spend and, within that target, where our priorities should lie. That is the debate in which we should be involved.
We should recognise that Gorbachev has changed the whole debate on arms. He has broken the cold war mould and we now have to address ourselves to what we put in its place. The Government cannot continue to play the red menace card to justify a defence policy that has continued for years. They must face up to the fact that a new mould is being created. They cannot pick up the pieces from the old mould. There is a new mould in which we should have a positive input and we should say that we want to be involved in the disarmament process. We want to ensure that our legitimate interests are looked after in that process.
We do not want to be left out. It is only too evident at present that this country is very much on the sidelines. If this country does become involved, it is to say, "Don't make progress. Don't do this. Stop that. We want to modernise this area of weapons. We do not want to get involved in the disarmament process." What we needed from the Government and the Secretary of State was a clear statement of how the Government are going to face up to the challenges of the next 10 years in which, with any luck at all, we shall be moving to a position where disarmament and not rearmament is the key.
I should like Ministers to tell us what is happening at the START talks. We are told that President Bush hopes that there can be an agreement on the first phase of those talks for the summer of 1990. Will that include some commitment on numbers for the United States Trident D5, to which my hon. Friend the Member for Clackmannan (Mr. O'Neill) referred earlier? If there is to be some agreement on the numbers of Trident C5s that the United States will be able to deploy, what are the implications for us on costs and the total numbers concerned? It seems inconceivable that the number that the United States will be able to deploy will be limited by those talks and yet we will not be included in that.
I understand that on 23–24 September, there were discussions about a memorandum of understanding about the START talks which involved the whole question of radar installations. The Soviet Union unilaterally announced that the station at Krasnoyarsk is to be dismantled. It then said that if it were to do that unilaterally, the United States should consider the dismantling of the radar installation at Fylingdales. Is that correct? If so, what discussions are taking place between the British Government and the United States about the future of Fylingdales? It may be that the United States is saying firmly that it is not prepared to go along with the Soviet suggestion. However, we should be involved in those discussions.
What do the conventional forces in Europe talks mean for Britain? If there are to be limits on the number of tanks deployed in Europe, what will be the effect on fresh orders for the Challenger tanks? What about the nuclear capability of the Tornados? What will happen to troop numbers in Germany? Those are all questions that we should address and matters on which we should decide where we want to go.
On the issue of troop numbers in Germany, one key question is: how will the armed forces successfully recruit youngsters? There has been a dramatic fall in the number of 18 and 19-year-olds. What are the implications for the conversion of our defence industries? The Government have made no comment. My right hon. Friend the Member for Chesterfield told us of the extent to which our economy depends on defence contractors. If there is a lessening of tension between the super-powers and a reduction in regional conflicts, the demand for weapons is likely to decline. We must look positively at ways to find new products for these companies and at how we can provide Government assistance for research and develop-ment so that these firms can produce goods for peaceful purposes.
I understand that the crucial debate at the conference in Geneva on disarmament is about a ban on chemical weapons, with the discussions involving not only the super-powers but other countries. Anyone who has seen pictures of the Iran-Iraq war and the effect of chemical weapons cannot fail to be impressed by the need to make progress.
Nuclear testing is also a subject at the Geneva talks. In the September talks, the Soviet Union proposed further bans on underground testing and announced that it would impose a unilateral ban on underground testing and plutonium production. So far, the United States does not seem happy about this, but at least it is prepared to discuss the issue. What has been the British Government's reaction? I understand that the Minister of State, Foreign and Commonwealth Office—the hon. Member for Bristol, West (Mr. Waldegrave)—responding for the British Government, said that any further underground test ban would be premature and destabilising because such tests were fundamental to maintain the British nuclear deterrent. It is appalling that Britain is dragging its feet in the discussions.
I have made my position on the Trident programme clear—it is immoral. We must, however, consider whether it has any credibility. Increasingly it is becoming a sick and expensive joke. The Defence Select Committee has said in its reports that there are major problems in terms of the

production of missile heads and of refit facilities. It is clear that the programme has been called into question because of what is happening in the United States.
I am pleased to see the Minister of State for Defence Procurement on the Government Front Bench. It is interesting that, when Sir John Nott announced to the House on 11 March 1982 that we would commit ourselves to the D5 missile system, the hon. Gentleman asked the crucial question. He started with a bit of flannel, telling the minister how wise the decision was, but he went on to ask:
what guarantees are there that during the currency of the procurement of the system it will not be cancelled, either at the whim of the United States Congress or as a result of changes of President or changes of presidential mood or attitude over the next 20 years?
Sir John Nott brushed the hon. Gentleman aside by saying that there was no problem. He said:
On the whole, our allies tend to keep to their agreements. I do not think that such a hypothetical situation has ever arisen".—[Official Report, 11 March 1982; Vol. 19, c. 982–83.]
Sir John Nott did not think that it would ever have any practical effect.
The United States is questioning the future of the Trident D5 programme. We understand that the British ambassador, Sir Antony Acland, is trying to convince senators and congressmen that they have to reinstate the $1·8 billion that they have cut from the programme.

The Minister of State for Defence Procurement (Mr. Alan Clark): I was doing that last week.

Mr. Bennett: It brings into question the Government's credibility. The British Government are supposed to be independent, but the United States Senate and Congress make the decisions.
We understand that committees in the United States decided on the cut because they had seen classified information—two trials failed and there were major problems with the missile system in the one that succeeded. It does not really matter whether the money is put back —if the system is technically in disarray, there are major problems. How can the Minister be so confident that the technical problems can be overcome? Those senators and congressmen who saw the classified reports felt that there was so much difficulty about the programme that they cut the amount of money available. I realise that this is a. matter of argument between the various parts of the: United States military machine, but there are two sides to the issue—either the United States will include the Trident missile system in START or, because of delays, the Trident system will be brought into question.
I have raised several times my point about the communications system for the Trident submarines. Ministers keep arguing, "We cannot tell the House of Commons about our communications system. It must be kept secret." There can be little credibility in that approach. If Trident is to be a deterrent, we should be prepared to tell people that we have an effective communications system. A deterrent can be credible only if people believe that it will work. The only argument in favour of the Government wanting to keep the system secret is that there is no system at all.
We are told that the Government are considering an extremely low frequency transmitter at Glengarry Forest in Scotland. How much will that cost? Is it merely an experimental station? If it works, will a full-scale station have to be designed? What is the time scale for construction? Obviously, the Trident programme is


slipping, Unless there is an effective communications system, there is not much point in having it. Unless there is a connection between the button and the submarines —it does not matter whose finger is on the button—the system does not have credibility. Will the ELF system stand up to electromagnetic pulses? Will we be involved if, following START I, START II or START III, the United States includes its Trident D5 system in the negotiations?
The tragedy of today's debate is that the Government have not put forward their strategy for becoming involved in the disarmament talks. Whether they are slow or very slow, so far the Government have said that they are not getting involved. Many Opposition Members and people outside believe that we should be enthusiastically involved in those talks and that we should be reducing the world production of armaments, finding jobs for those who are displaced and ensuring that they can produce goods that are socially much more useful for this country and the world.

Mr. Keith Mans: I should like to apologise to the hon. Member for Clackmannan (Mr. O'Neill), who unfortunately is not in the Chamber. I had no idea when I was attempting to intervene that it would be quite so easy to disrupt his speech. I can only assume that it was easy because he had the greatest difficulty in following it himself. Not only Conservative Members but Opposition Members felt that some of his arguments were, to say the least, a bit specious.
If I had been allowed to inervene, I would have said that I was interested in the fact that finally the Labour party had admitted that in real terms the cost of the Trident missile programme was on the way down, not up.
I was less convinced by the Labour party's new policy, which does not seem to go for parity of weapons, conventional and nuclear, with the Soviet bloc, but is prepared to accept the Soviet bloc's superiority in a wide range of weapons systems.
I was interested that the hon. Member for Clackmannan (Mr. O'Neill) seemed to support various defence companies which are worried about how Ministry of Defence competitive tendering has been organised. I do not share his worries. Surprisingly, it was the right hon. Member for Chesterfield (Mr. Benn) who explained to his own Front Bench that the hon. Member for Clackmannan had nothing to worry about, as such companies had made £3·3 billion in profits last year. I have little doubt that competitive tendering has been successful during the past few years.
As many hon. Members have said, since last year's debate on defence procurement, there have been rapid changes on the international and national scenes which have profound implications for this country's defence and for the future of NATO.
The belated recognition by the Labour party that its policy of unilateralism cannot be sustained, and its adoption of a weak and illogical form of multilateralism, should not go unnoticed. It should also not go unnoticed that Labour's new defence policy envisages Britain scrapping a nuclear deterrent, but a potential aggressor such as the Soviet Union still having nuclear weapons. Despite the appearance of the Labour party radically

shifting its position on nuclear matters, in reality it has only moved a few tentative steps in the right direction and then stopped.
The commitment accompanying the reduction in the nuclear deterrent, to cut conventional defence forces by around £5 billion, or 25 per cent. of the present defence budget, gives cause for concern. The Labour party may try to wriggle out of it and to say that it is not a binding commitment and may occur over a number of years, but if a commitment to a weaker form of multilateralism and a decision to reduce conventional forces were taken at the same time, at the same Labour party conference, even if the decision to cut conventional forces is not binding, it must call into question Labour's commitment to any sort of multilateralism at all.
It is significant that, throughout these debates on the armed forces during the past two years, we have been told by the Labour Front Bench—it has been its constant refrain—that the Government have cut conventional defence expenditure to maintain a nuclear deterrent. While that is untrue, it is a little odd that the Opposition now want to go further down the route that they have previously criticised the Government for taking. Such cuts would mean that the country would not be adequately defended. For example, they might mean the complete cancellation of the European fighter aircraft programme which would have a horrifying effect on job prospects in the north-west. These policies could also mean the elimination of the whole of the Royal Navy's surface fleet, or a huge reduction in the number of ground troops we commit to Europe. It is clear that, if such cuts were carried out, every soldier, sailor and airman would have to go into battle virtually defenceless.
As to the much saner policies of the Government, I congratulate my right hon. Friend the Secretary of State on the measures the Government have taken to help recruitment. In particular, the extra encouragement to women to join the armed forces is very welcome. The change of policy to allow women to train as pilots is one that many hon. Members have asked the Government to consider, and I am delighted that it has happened.
Still more needs to be done to help recruitment and retention of personnel. If the armed services are to continue to attract and retain the right calibre of personnel, a more flexible pay policy will have to be introduced. That policy, as in any other business, should be designed to pay the market rate for skills that the armed services need to retain. It would almost certainly mean more reliance on specialist pay rather than on rank pay. For example, flying pay will have to be doubled, if not trebled, if the losses of highly experienced and highly trained personnel to airlines are to be stemmed.
I hope that my hon. Friend the Minister will press the Treasury to allow service men who sign for a further term, who have come to the end of one term, to keep the gratuity. At present, they obtain the gratuity only if they leave. Some service men leave, take the gratuity, and return a year later, to the resentment of those who have stayed in service. I am convinced that, if the gratuity were given at the end of the first period of service, it would stem the flow of experienced service men who leave at the end of their first engagement.
Another measure that is long overdue is a better service saving scheme to make up for the disadvantages service personnel suffer compared with civilians when buying a house. My hon. Friend the Member for Canterbury (Mr.


Brazier) has pressed very hard for a scheme to solve this problem, and I hope that the Ministry of Defence will give it further consideration.
A subject that is allied to recruitment and retention of personnel is the contracting out of certain service functions to civilian companies. I approve of contracting out as it gives the taxpayer better value for the money spent on defence, but I feel that the Government have to move carefully in its application.
The recent security scares have shown how thin on the ground service personnel are at certain locations and how, because of contracting out, they are expected to carry out an increasing number of additional tasks, such as guard duties. That does not help morale in the services or encourage people to stay on for a further engagement.
Contracting out should be examined and clauses should be included in contracts to encourage employees of civilian firms to join the reserve forces so that extra personnel are readily available in times of emergency or high alert states to carry out the many additional tasks that need to be completed at those times.
I find it a little strange that the armed services have to employ private security firms to guard military installa-tions while they have in the past provided the Home Office with service personnel to guard prisons.
I congratulate my right hon. Friend the Secretary of State on the recent 4 x 4 lorry contest and the way it was organised. It shows clearly the advantage of competitive tendering when it is carried out properly. I am convinced that the contest will be the forerunner of many more highly successful contests of that nature.
I hope that the Ministry of Defence will soon be able to order the naval version of the EH101 and the utility version of this aircraft for the Royal Air Force. The Secretary of State has rightly drawn attention to the need to procure aircraft and other weapon systems across service boundaries, and helicopters are a good case in point. I realise that the RAF is lukewarm about funding the EH101, as it feels that this may compete against any future funding for the updating of the Nimrod air-to-surface anti-submarine aircraft.
This problem also exists over the procurement of the light attack helicopter, about which the RAF is lukewarm because it feels that the funds spent on it may come from other projects about which it is enthusiastic, such as updating the ground attack capability of the Tornado, the Harrier and, in the future, the European fighter aircraft. The RAF will have to pay more attention to helicopters than it has done, because they provide good value for money in the land battle order. It is high time that the Ministry of Defence decided the mix between tanks, helicopters and artillery in the air-land order of battle. By not doing so, it is holding up procurement of important weapons systems.
The mid-life update of the Tornado, and more specifically the provision of a stand-off weapon for that aircraft, needs more attention. Now that the United States seems to be less enthusiastic about the version of that weapon that we should like to procure, it is all the more important that we make certain that we get on board some of our European allies to produce a weapon that meets our specifications, and to make certain that the Tornado continues to be a highly effective weapons system well into the next century.
The changes that have taken place over the past year will mean, over a number of years ahead, great changes in

our views on defence. It is important now that we maintain a strong guard during the period of instability in eastern Europe. These estimates show that the Government are doing precisely that.

Mr. Jim Sillars: I was extremely disappointed by the speeches of the two Front Bench spokesmen. It would be churlish not to welcome the Secretary of State to his new post, but his speech was seriously deficient, and that deficiency was also apparent in the speech of the hon. Member for Clackmannan (Mr. O'Neill). Both of them meandered around the place, but neither had any strategic sweep or vision in the make-up of their ideas and their concept of this important issue. Both went out of their way to avoid a key element of the framework of the so-called British defence system in the immediate future—Trident. The Secretary of State hardly mentioned it.
I thought that the hon. Member for Clackmannan was bound to mention Trident. During the recess, on 28 August, I read an article in The Guardian headlined:
Delays 'put Trident in jeopardy'.
It then had a smaller heading:
Labour warns nuclear defence programme is at risk.
It then quoted the Labour defence spokesman as saying:
Sir Francis's study is the first public admission of the failure to organise the production of the British element and the so-called independent deterrent. After months of complacency and denial, the MoD has finally admitted that there are severe shortcomings in the programme.
I could not make out from that whether the hon. Member for Clackmannan was happy about the problems because that might lead to there being no Trident, or was unhappy because the problems might be solved and lead to Trident being here. There was an illogicality and a serious ambiguity about his position.
I thought to myself, "Not to worry, Martin is on holiday as well and we are all entitled to a breather. He'll come to the big two-day defence debate when we return, open for the Labour party and we will get it laid out." I thought that there would be a close probing of the Government about Trident. We might not get Trident, and the Labour party would hope that what is happening with warheads and in the Congress of the USA would lead to no Trident emerging. As I understand the Labour party's position, it does not want Trident, but unfortunately vessels 1 and 2 will be built and vessel 3 will be 40 per cent. through and a future Labour Government will have to accept them, however reluctant they are, but they will not take the fourth.
Such an attitude is different from what I understood was the Labour party's previous position, which was that Trident could not be put in place on the Clyde at all. There would be no Trident, no warheads, none of the rest of i t. However, the hon. Member for Clackmannan told us nothing about this. There was also nothing from Labour as an element of the Socialist movement, despite what we expected. There should have been some understanding of the window of opportunity now opening because of events in eastern Europe.
I am not naive. I know the Communist system very well —[HON. MEMBERS: "Oh!"]—from a study point of view. I have never been a member of the Communist party. I have always had grave doubts about the ability of the Soviet-Marxist system to reform itself fundamentally, without the most serious dislocation and going into a


catatonic state. I hope that the Gorbachev wing of the Soviet Communist party succeeds, although I fear that he may become a victim of present circumstances. There is a great paradox. Mr. Gorbachev is far more popular in western Europe and the Warsaw pact countries than he is inside the Soviet Union.
On the fundamentals, the politics there is essentially not different from the politics here. If Governments cannot put money in the pocket, food on the plate and people into decent housing, or provide a health service, they lose public support. After four years, Mr. Gorbachev's policies are not delivering the goods to the ordinary Soviet citizen. I should be sorry if he fell from power, because the world owes him a great deal, but it is interesting that in East Germany, West Germany and the United States he is popular, but one would not find crowds shouting "Gorby, Gorby" in Moscow, the Ukraine, Byelorussia or other parts of the Soviet Union.
Even if Mr. Gorbachev is a victim of the changing circumstances, we cannot go back to the Brezhnev-style years. Gorbachev is an individual, but he is a representative of an important movement for change in the system. While he might be a victim of it, Russia will never be the same again. I should have thought that someone coming from the Socialist movement, like the hon. Member for Clackmannan, would have some idea of the opportunities that are opening up. We must make real and substantial gestures, and we on this side of the eastern bloc should start mobilising resources to help people rather than to build weapons to kill them. That would assist the reform movement in the Soviet Union, because it requires technical assistance, training, technology and the transfer of capital. How much better it would be for a member of the Labour party, which is supposed to be a Socialist organisation, to have such a programme. However, we did not get it.
The Scottish National party has been unilateralist for many a long day and it will remain so. It is consistent in its policy—almost as consistent as was the Leader of the Opposition until a short time ago. I shall now examine why the Labour party changed its policy and rejected unilateral nuclear disarmament as a means of contributing to the process of disarmament and peace. I shall also apply the test of difference to a concept being touted around Scotland by the hon. Member for Glasgow, Garscadden (Mr. Dewar), who leads the Labour party north of the border—a concept of Scottish independence in the UK. That is the Labour party's answer to the Scottish National party's policy of Scottish independence as a member state of the European community. The term used by the Labour party north of the border—I am sure that this will surprise many Labour party supporters south of the border—is independence in the United Kingdom.
Defence policy is a reasonable test of whether there is genuine independence. As I understand it, over many years the Labour party's policy on unilateralism rested on three foundations. The first foundation was that the British bomb was not independent. Secondly, the Labour party argued that it had never been a deterrent. Thirdly, it alleged that it was deeply immoral to use the bomb, even in retaliation. I shall quote the Leader of the Opposition on this issue. The right hon. Gentleman made the position

clear, and in so doing gained much approval from folk like me. On 13 February 1984, when addressing the Carnegie Endowment in Washington DC, he said:
In nuclear war, initial attack—whether by first strike or first use—would be an act of self-immolation and retaliation a gesture of supreme and terminal futility.
I also quote someone else who is now a Member of this place but who used to be known outside as Brian Wilson. I refer to the hon. Member for Cunninghame, North (Mr. Wilson). When writing in the West Highland Free Press —it is an extremely important newspaper—he was involved in an exchange with the then Tory Member, Hamish Gray, who is now in another place. In his peroriation, he wrote:
But above all the case against possession or use was a moral one—the mass slaughter could never be justified whether as 'first strike' or 'second strike', by which time the only motive would be revenge.
The hon. Member for Houghton and Washington (Mr. Boyes), who sits on the Opposition Front Bench, is mumbling. Let him understand that I was referring to the view of the Leader of the Opposition in 1984 and that we are now in 1989. Anyone who turns to pages 86 and 87 of the Labour party's policy review document will find that two of the three foundations to which I have referred remain solidly in place. It is declared in the policy review document that the British bomb is not independent, and it is denied that the bomb when held in British hands is a deterrent.
That leaves the third foundation of morality. What about morality? Before the hon. Member for Houghton and Washington gives me a sotto voce lecture about 1984, let him understand that I have known the Leader of the Opposition for a long, long time. He was a comrade in arms of mine inside the CND and the unilateralist movement. We are both members of the Transport and General Workers Union—I am as proud of that as he is —and that organisation has held firmly to unilateralism. Underlying every speech of the Leader of the Opposition that I ever heard was the fundamental of the immorality of pressing the button. Would the Leader of the Opposition press the button? That is the third foundation. If there is a change of policy, that can be only on the basis that he would press the button now when he would not do so previously.
The Guardian is not a newspaper that is likely to misquote the Leader of the Opposition, but in an article of 18 May it told us that the right hon. Gentleman personally wrote two fresh passages into the Labour party's defence policy, one formally defining the party's line on whether a Labour Prime Minister would be willing to press the nuclear button. It stated:
On the question of using nuclear weapons, the document now states that 'nuclear weapons should not be used by any Government', but that the party 'recognises that for as long as the weapons exist, the assumption by other nuclear powers will inevitably be that circumstances could arise in which they might be used.
That is a good lawyer's draft—"Maybe we shall, maybe we shan't, but read out of it what you like"—but it was an attempt to answer the question. We were told in the article that "the document now states". If anyone reads the Labour party's policy review document, he will not be able to find the passage which I have quoted in the defence section. Between 18 May and the Labour party's conference at Blackpool in October, it disappeared. Therefore, the question remains to be posed to the Labour party: will it press the nuclear button or will it not?
I have listened to Trades Union Congress speakers and I have listened to Labour party speakers. They have explained that they have changed their policy because the world has changed. They say that there has been what the Labour party's policy review document describes as "epoch-making changes". In a handout from the Ministry of Defence entitled "British Defence Policy", great changes are acknowledged by the Prime Minister. One passage reads:
Recently, says George Younger, under president Gorbachev the Soviet Union and its allies have become more ready to respond to these initiatives. As the Prime Minister said during President Gorbachev's visit last month, we welcome these signs of a peaceful revolution in Soviet thinking.
These are "epoch-making changes" and "signs of peaceful revolution". I say to Opposition Front-Bench Members that the world has changed for the better. The Warsaw pact has profoundly changed. In my view, it has changed irreversibly. Its ability to mount a so-called surprise attack, which is central to the White Paper around which the debate is centred, is no longer what it was four or five years ago. Are we to believe that under big bad Mr. Brezhnev, with his doctrine of intervention, the Labour movement was prepared to go into unilateral nuclear disarmament, and that under nice Mr. Gorbachev, with a great loosening of the ties between the Soviet Union and countries such as Hungary, Czechoslovakia and Poland —Poland does not have a Communist Government now —it is not prepared to take that course? That is an absurd position. I say to the hon. Member for Houghton and Washington that I regret the Labour party's position and believe it to be deceitful and distasteful.
The Labour party boasts of making Scotland independent within the United Kingdom. Defence policy provides the acid test. At the Scottish Labour party's conference, which was held in March, there was a vote on changing the Labour party's defence policy. A report in The Sunday Times on 12 March stated:
Delegates voted overwhelmingly to reaffirm the Scottish party's support for unilateralism. Not a single speaker in the hour-long debate supported any change in policy.
The vote was overwhelming. Correspondence in the West Highland Free Press over the past month has shown that, of the 72 constituency Labour parties in Scotland, only two support the new policy. The other 70 remain in support of the Scottish Labour party's conference in March.
What happened when the Scottish Labour party arrived in Blackpool? The answer is that it was brushed aside and entirely ignored by the chiefly English component of the British Labour party which wished to chase Tory votes in the south-east of England. What are the implications for the future?
Let us consider numerically and qualitatively the Scottish Labour contingent in the House. I think that most of us would agree that it supplies a fair amount of the brain power within the shadow Cabinet. I think that there is a general recognition that it provides qualitative input, and all of us agree with that irrespective of political divisions. The PPS to the Leader of the Opposition is the hon. Member for East Kilbride (Mr. Ingram). The Scottish contingent represents over 20 per cent. of the Parliamentary Labour party. That is a powerful position when it comes to applying the Scottish decision in March in this place.
It seems, however, that that position has had no effect within the Labour party. The Scottish contingent could not sustain the Scottish policy position against the wishes of the southern part of the Labour party, which wishes to chase Tory votes in the south of England. The policy implications for a Scot who is an active member of the Labour party north of the border are horrendous.
On the question of the bomb, Polaris and Trident, the Labour party has betrayed the Scottish electorate. Its policy on unilateralism was put to the Scottish electorate in 1983 and was tested again in 1987—and the party increased its Members of Parliament north of the border. I must tell the Secretary of State that, whatever opinion might be in other parts of the British state, unilateralism is a popular policy in Scotland, which has hosted Polaris and is targeted for trident. The Labour party has betrayed us, and it will pay the price.

8 pm

Mr. Robert Hayward: It is a great pleasure to follow the hon. Member for Glasgow, Govan (Mr. Sillars), who has clearly and lucidly identified some of the intellectual illogicalities of the Labour party in its national policy. I was fascinated by his assessment that 70 of the 72 Scottish constituency parties had expressed a view one way or the other, given the fact that several of them—including Dumfries, Galloway and Upper Nithsdale—did not even cast votes at the Labour party conference for people in the constituency section of the national executive. Those constituency parties may have expressed views on one matter, but they were somewhat weak on the ground when casting their votes.
It is somewhat unfortunate that in our debate this evening the Government have clearly outlined their defence policy, as shown in the two documents before us; that the SNP has clearly outlined its defence policy through the hon. Member for Govan, and a consistent policy has been outlined by the hon. Member for Liverpool, Walton (Mr. Heffer) and the right hon. Member for Chesterfield (Mr. Benn)—although I could not agree with his interpretation of history—yet the Labour party and the SLD, the LD, the Liberal party or the Alliance, whatever it now calls itself, have shown an absolute lack of clarity all along the line.
I intervened in the speech of the hon. Member for Clackmannan (Mr. O'Neill) and quoted an article in The Times on Thursday 14 September. He said that he would give me a reply later in his speech. That is a fairly usual tactic when someone does not know the answer, and of course I was never given the answer.
The hon. Gentleman's other comment was that I was using information provided by the Whips and that I had quoted only from that part of the article provided by them. Unlike some members of the Whips Office, I was not on holiday on 14 September. I read the article and gave interviews at that time. I have the article in full, and I shall quote the two relevant paragraphs—[Interruption.] The hon. Member for Rhondda (Mr. Rogers) does not like that because he knows what is in the article.
The article states:
Declining to set targets for the level of defence expenditure, Mr. O'Neill said that there was no doubt that production lines would disappear, others would be cut and planning and production teams would be broken up.
The Times quoted the hon. Gentleman as saying:
What is clear is that the incoming Labour Government"—


[Interruption.] Opposition Members do not like hearing me quote their Front Bench spokesman. He said:
What is clear is that the incoming Labour government will face the consequences of an overblown and ambitious defence programme that no British Government could or would want to be able to meet.
Therefore, the Labour party is saying that there must be cuts in the defence programmes somewhere. Yet what did we hear? When the right hon. Member for Manchester, Wythenshawe (Mr. Morris) asked about Ferranti, the hon. Member for Clackmannan gave him the assurance that it was not Ferranti. What about Westland? The hon. Gentleman said that the Government had not committed enough to Westland or to the Navy. He also said that nuclear defence would be safe.
It is surely only reasonable to presume that the cuts to which the hon. Gentleman referred must be made in conventional forces. Based on figures quoted by my right hon. Friend the Secretary of State today, and reaffirmed by the right hon. Member for Chesterfield, my calculation is that in the west country alone some 10,000 jobs will be at risk. I shall explain how I reached that figure——

Mr. Roland Boyes: By making it up.

Mr. Hayward: I am not making it up.

Mr. Rogers: The hon. Gentleman can carry on with whatever claptrap he likes, but before he sits down I hope that he will tell us how many jobs have been lost under this Government in the arms industry since 1984.

Mr. Hayward: The figures have already been provided by the hon. Member for Clackmannan. In my part of the country, Dowty employs 8,000 people in Cheltenham and the surrounding areas, Smiths employs 3,000, British Aerospace more than 8,000 at Filton, Rolls Royce about 8,000 at Filton and Westland 4,250. If the Labour party adopts the policy that it has expounded in articles such as that in The Times, it must be honest with those employees and also with all those who are dependent on those industries, such as sub-contractors, taxi firms and service industries. The Labour party must say which of those production lines will be closed. I calculate that some 10,000 people in the west country alone can reasonably expect to lose their jobs.
Of course, I have been referring only to defence and aerospace. The hon. Member for Clackmannan, in one of his more relevant comments, said that related civilian businesses—he referred to Ferranti—were dependent on the research, development and sales of the defence industry. Therefore, if defence jobs are at risk, so too must be civilian jobs. At least the hon. Member for Liverpool, Walton had the honesty and intellectual intelligence to recognise and admit that. I do not understand why the Labour Front Bench will not do the same.

Mr. Rogers: The hon. Gentleman has not read the speech.

Mr. Hayward: I have read it, and the hon. Member for Clackmannan did not mention one point from the Labour party defence review. We can only presume that he is really saying, "This is the policy we want to adopt, but this is the policy that we will adopt for electoral purposes alone."

Mr. Boyes: The problem is that the hon Gentleman has read only two or three paragraphs of a lengthy speech made to the UCATT conference, which dealt with conversion. The thrust of the speech—and I hope that Conservative Members agree with it—is that if we can get agreement between various countries to reduce the level of armament needs and army strengths, the world will become safer. The Labour party has not adopted policies that will put the workers referred to by the hon. Gentleman on the  dole queue. We are talking about conversions and putting people into socially acceptable jobs. Surely the hon. Gentleman agrees that that would be both honest and sensible. I hope that the hon. Gentleman will ask my hon. Friend the Member for Clackmannan whether he can read the whole of his speech. He might then regret some of the comments that he has made tonight.

Mr. Hayward: I do not regret any of the comments that I have made tonight. I listened to the whole of the Labour party's defence debate at the party conference, when there was an opportunity for the hon. Member for Clackmannan to correct any misunderstandings. He also had the opportunity to correct any inaccuracies in The Times article by writing a letter to that newspaper. There has been no such correction in the letters column of The Times. He has not attempted to correct any misun-derstandings that might have arisen from his speech.
Unfortunately, the Liberals are no better. They are not represented here this evening, but let me quote from a motion that was passed at the Liberal party conference in the same week that the hon. Member for Clackmannan was addressing the UCATT conference. Among other things, that motion says that the Liberal party wants an end to Government involvement in promoting arms exports and, in particular, that it wants to close the Defence Exports Services Organisation and to cease financial support for arms exports from public funds by, for example, the Export Credits Guarantee Department.
Virtually every export order that has been achieved in relation to Hawk and Tornado alone, and probably in relation to Westland and a number of other industries such as Smiths and Dowty, which supply those major contractors, have been earned as a result of commitments from the ECGD.
If the Liberal Democrats do not want us to have the ECGD or the DESO, we must kiss all those orders goodbye because the French will step in to take our place. If the French do not, others such as the Americans will. It does not matter which country: one will step in and those orders will go by the board.
If the Labour or the Liberal parties put forward policies they should give due consideration to the impact of those policies. The hon. Members for Walton and for Govan have admitted the implications of their policies and the Liberal and Labour parties should admit the implications of their policies. They should be honest and not try to hide behind a series of quotes and sham defences.

Mr. Eric S. Heffer: Let me explain to the hon. Member for Kingswood (Mr. Hayward) that cuts in defence expenditure do not mean job losses. Research shows that investment in construction in the NHS and in education produces 60 to 80 per cent. more jobs than investment in defence.
I should also point out that in the past 10 years in which the Government have held office, the number of jobs directly related to defence has fallen from 390,000 to 310,000, despite an increase in the defence budget from £7·5 billion to £20 billion in the same period. I put that on the record because the hon. Gentleman must not believe that defence cuts will necessarily mean massive job losses, although that could be the case for a time; certainly, if the money is not invested in other directions there will be job losses.
As my right hon. Friend the Member for Chesterfield (Mr. Benn) said, the Secretary of State's speech was one of the worst from any Secretary of State for Defence that I have ever heard. It was a poor speech. The Secretary of State made the remarkable statement that we must maintain our defence policies and put pressure on the Soviet Union if we are to help the people of that country, or the countries of eastern Europe, to get their freedom. Let us think about that for a few minutes.
Does not the Secretary of State realise that that is precisely what some of the Soviet generals, the bureaucrats and the old guard in the Soviet Union want'? That is their argument for getting rid of Gorbachev. That is their argument for saying that there is no point in getting rid of their weapons and carrying out the sort of policies that Mr. Gorbachev wants them to carry out because the West will still build up its arms and will continue to be the threat that they say that it is. That is their very argument for undermining Gorbachev and the people in the Soviet Union who want to bring about change there. That is not a sound argument. It is a silly argument.
I have heard one or two other arguments from Conservative Members. Some referred to the events of Tiananmen square. But what happened there was that the man who had some sympathy for freedom was removed from the general secretaryship of the Communist party. The hard-liners and the old element even went back on the so-called policy, about which we have heard so much, that if one has private enterprise, freedom automatically follows. China had gone part of the way towards private enterprise. That took place internally.
It is nonsense to equate freedom with private enterprise. Hitler's Germany had private enterprise, but it did not have freedom. So far, there is no political freedom in Pinochet's Chile or in South Africa. One could go on naming country after country where private enterprise and the market economy are wonderful but where there is no political freedom. It is wrong to suggest that in the Soviet Union freedom has been suppressed because of a nationalised or publicly owned economy. One should begin to look at the history of those countries and recognise that freedom was destroyed relatively quickly after the revolution. Freedom did not last long because of the nature of the Communist party. There were Left-wing socialists such as Rosa Luxemburg and others who pointed out at the time that the proletariat would mean dictatorship over the proletariat—the dictatorship of one man and a small group.
I have long taken that point of view. I was brought up in the Socialist-Communist tradition. It took me some time to understand what happened, but by reading, studying and looking, I became, as I have remained, an opponent of the internal system in the Soviet Union and, at the same time, a firm believer in genuine democratic Socialism. There is no contradiction between the two; that must be clearly understood.
I am sorry that the amendment in the name of my right hon. Friend the Member for Chesterfield, myself and others has not been called, but I understand the procedures of the House. However, as my right hon. Friend said, at least we can express an opinion on it. I support that amendment because it is similar to the resolution that was overwhelmingly carried at the Labour party conference. To those in my party who may not like what we are saying, I say that our amendment is in line with a conference decision, so I trust there will be no talk of discipline in relation to the views that we are expressing. Come to that, I do not care if there is—that does not worry me. I have been in this House a long time and have fought many battles by going through the Lobbies to vote on important issues, and I will continue to do that.
Ours is a common-sense motion and should be supported for that reason. It states:
Britain should reduce its defence spending, initially to equal the average level of other Western European countries, and transfer the savings made to social and economic priorities including the National Health Service, pensions, housing, education and other vital services".
As for other NATO countries, Greece spends 6·6 per cent. of its GDP on defence. Next comes the United Kingdom, with 4·3 per cent., and Turkey spends 4·2. Greece and Turkey spend such high amounts because they hate each other. Although they are in NATO they seem more concerned with looking at each other than with the external defence of Europe.
If we reduced defence expenditure to 3 per cent. of GDP we would save a great deal of money: the annual bill would fall from £21 billion to £15 billion, which would add up to a considerable amount in five years, and all of it could be used to help the National Health Service, housing, education and so on. That would not leave us defenceless; we should only be spending the same as our European neighbours in NATO.
Our motion does not go as far as the suggestions of the hon. Member for Glasgow, Govan (Mr. Sillars)—it does not speak of unilateral nuclear disarmament, restricting itself to general defence spending——

Mr. Sillars: I hope that the hon. Gentleman is not back-tracking.

Mr. Heffer: Certainly not. I entirely agree with unilateral nuclear disarmament, but this motion does not argue for it.
We could use the money saved, on construction. The Tories boast about what they have done for people in the way of housing. They have certainly sold a lot of council houses and built a lot of private houses, but then they put the interest rates up so high that people cannot afford to keep up the payments on the houses that they are trying to buy. There is something funny about the Conservatives; I do not understand how they can claim to be on the side of house owners and then put mortgages up by so much that these people are crippled and have to spend all their money on them, leaving them with no money to spend on food or clothing. That does not seem logical, but it is a problem for Conservative Members which they will pay for in the end
The money could be spent on what the people of this country need. I believe in unilateral nuclear disarmament. and have done for a long time. I know that my hon. Friend the Member for Paisley, South (Mr. Buchan), like me, was in the forces. I remember hearing about the dropping of the bomb. I recall the shudder of horror that went through


me. At the same time, we all felt relief because it meant that we would not be going over there. Later, we realised that the bomb meant that a new dimension had entered warfare, which would no longer be even what we had experienced. It could mean the absolute destruction of mankind. That thought has lived with me every since, and when I think of it from time to time the horror still comes back to me. There would be no winners after the bomb was dropped.
On the other hand, we think of the misery in the Third world and elsewhere. There is massive poverty in Latin America, Asia and Africa and in parts of the so-called marvellous developed world—in parts of America and even in our country there are people who live in disgraceful poverty. Yet we spend millions and millions of pounds on weapons of destruction.
I conclude with a quotation from a book which I happened to buy yesterday in the Church house bookshop, "The Bible, the Church and the Poor". It is about liberation theology. Hon. Members know that I study this closely because my Christianity and my Socialism are one and the same. The book says:
Just as the situation of the poor has a structural cause, so their liberation has to go through the process of changing the social system, which prevents them from growing and playing a positive part in history. The poor judge society as it is at present, and see that if their situation is to change, this change has to come about in a new form of society.
That is what I believe. I believe that as long as we continue to waste millions of pounds on destructive weapons we will never create that new society. Part of changing the world is getting rid of these dreadful nuclear weapons and working for world peace in a way which we never have before.

Mr. David Martin: I recognise the sincerity of the hon. Member for Liverpool, Walton (Mr. Heffer) whenever he speaks on these matters, some of which I shall refer to in my speech.
Like my hon. Friend the Member for Hampshire, East (Mr. Mates), I welcome the remarks of the hon. Member for Clackmannan (Mr. O'Neill) about the outrage perpetrated at Deal on the Royal Marines bandsmen. Originally, the bandsmen's base was at Portsmouth and they still have a presence there, albeit a greatly reduced one. However, there has been no reduction of affection and respect for the Royal Marines in the hearts of the people of Portsmouth. I was abroad when I heard the news and I reacted with an abject horror which I know was shared by many of my constituents. Not long before, I had seen the Royal Marines band perform during Navy days in August, and I look forward to seeing them perform again on Trafalgar day—21 October. There is a striking contrast between the finest bandsmen in the world and the barbarism of those who attacked them, between the highest standards of their service and the lowest standards of their attackers. One can understand people's tremendous feelings of sympathy for the relations of those who suffered and for those who must confront terrorism in our country day by day.
I want to deal with something that has been mentioned many times during the debate, and that is how we should look at East-West relations given the changes that have

taken place with the better understanding which undoubtedly exists, and which so many people hope will continue to exist between this country and the Soviet Union and between NATO and the Warsaw pact.
We have had a history lesson from the right hon. Member for Chesterfield (Mr. Benn) and the hon. Member for Liverpool, Walton (Mr. Heffer). We have gone back to wartime and since. Europe has been dogged by the wartime legacy. The right hon. Member for Chesterfield referred to the fact that, after the war, many people thought that the Russians would remain our allies and Russia was not perceived to be the threat which it soon became, in the opinion of all sensible people. We have never forgotten which side the Russians were on at the beginning of the war. During the war, they became our allies and many people hoped that they would remain our allies. But after the war many said that the Russians should be pushed back behind their borders. They asked why we had fought a war only to leave them under such a system when we had gone to war to defend the freedom of so many countries—such as Poland—which remained within the Soviet empire.
The Soviet empire was built in the late 1940s and during the cold war, which was recognised at the outset by Winston Churchill in his famous iron curtain speech. Since then it has been a threat and there has been every reason for NATO to retain a strong defence. NATO was not created because there was no threat. It has not been around for so many years with so much expenditure in time, trouble and treasure because there has been no threat. Sensible people have been aware of that threat and have stuck to that view while the siren voices of CND and others have said that we do not need it; that we should turn arms into ploughshares; that we should have social spending on hospitals and schools instead of what was described as socially unacceptable arms expenditure.
We have ignored that. We have carried on, we have kept strong, and there is no doubt whatsoever that the strength and leadership of the West has made Russia realise that she will not under a Brezhnev regime or under a Gorbachev regime weaken our resolve to defend our freedom. We have set an example to the peoples of eastern Europe and shown them the freedoms that they could have.
What could be more moving than to see the people coming from the countries of eastern Europe and the value that they put on freedom? They give up all they possess to come as refugees to a country that they believe will give them hope and the freedom that they have been denied for so many years. That is an eloquent appraisal of the system that still exists in eastern Europe and is at the heart of the Soviet empire.
When any empire begins to break up and discovers that its many varied peoples are struggling against the tremendous discipline that keeps them together, there will be trouble. A continuing amount of trouble will be created in Russia and Gorbachev will have to face up to that. The troubles with the subject peoples of the empire on the borders of the Soviet Union will increase and penetrate the very heart of the Soviet Union.
I am not as optimistic as so many people who say that we are now in an era when we can relax and that not only can we disarm but that we will have peace everlasting because of Mr. Gorbachev. There are great dangers in that opinion. He will never allow the vital base of order to be
undermined, and if he does, many around him will not allow it and there will be a reaction as we have seen so brutally in Tiananmen square in China.
Not long ago, I spent a holiday reading a book describing how China had seen the light and was coming round to Western ways and how Western nations were tripping over themselves to go to China and give economic aid and advice. It was said that China would be the first nation to tread the road of Communism and return from it. We saw the end of that in Tiananmen square. It was a brutal end and it was shown to the world how fast things can change in a country that had been considered to be more understanding of the freedoms of its people. That could happen in Russia.
I do not wish to give the benefit of the doubt to those who say that we should now put down our arms and turn our expenditure to other more socially acceptable pursuits and that we should disarm, as in the new era people will not support the arms we possess. I believe that that would be a wrong judgment. I believe that we should continue, as this Government have continued for so many years, to disarm only on the basis of a fair exchange. I have absolutely no doubt that no Government will be elected to office that does not believe that Britain should retain nuclear weapons for as long as other countries have such weapons targeted on Britain. That applies to nuclear and conventional forces. Russia has not yet disarmed to the extent that many would wish. We have had promise after promise. Let us see that those promises are delivered and then we will disarm to match them.
I wish to comment about what has been said about pressing the nuclear button. The hon. Member for Glasgow, Govan (Mr. Sillars) was searching for quotations to show whether the Labour party, if it were given the responsibility of office, would have a Prime Minister who would be prepared to press the button. The latest quotation I have from the Leader of the Opposition on this matter comes from the BBC television programme "On the Record" on 3 February 1989, when he said:
I would not use nuclear weapons because that means annihilation and there is no logic in fighting with nuclear weapons.
That remains the right hon. Gentleman's view and his connections with CND, the campaign for one-sided nuclear disarmament, remain the same. There has been no repudiation, and in his heart that is what he believes. If ever we have such a man in Downing street our nuclear deterrent will be nugatory within weeks, and certainly if there were not an immediate disarmament of nuclear weapons in the minds of potential enemies there would be the feeling that we no longer had the strength of purpose and strong leadership in Downing street to defend our freedoms and the freedoms of the West on a satisfactory nuclear and conventional basis.
I started my speech by referring to the Royal Marines in my constituency. I conclude by making a plea about the searchlight tattoo at the Royal Marine barracks at Eastney, in Portsmouth, which I hope will continue when the future of the Eastney barracks is finally resolved. It is a very popular event which raises money for worthwhile service charities. It creates a great deal of interest and is very much in the affections of the people of Portsmouth. It would be a great pity if such an event were to end because of developments regarding the naval estate in Portsmouth.
The Royal Navy field gun crew should continue in modern times. It is just as relevant now as it ever has been. There are disciplines to be learnt from the field gun crew, as well as from its role in recruitment. It adds a human touch, diversity and something extra which cannot be judged in terms of money to the Royal Navy and the traditions which we have come to expect from the Royal Navy which are respected so highly in my constituency.
If I did not speak strongly on that matter, my constituents would wonder why I had not done so. I cannot say strongly enough that the Royal Navy in Portsmouth remains as welcome as it has been for centuries. Anything that can be done to keep its traditions and its role will be highly welcome. I know that the Ministers responsible will take that into account in any future decisions.

Mr. Tam Dalyell: The House will forgive me if I say that I feel sick, sweaty and headachy. The explanation is that it was Scottish Question Time this afternoon and, like other hon. Members, I have been sitting here since roughly 2.30 pm. The glare of the lights is damnable, and until such time as someone can alter the powerful glare, quite understandably, hon. Members who have to sit for a long time to catch Mr. Speaker's eye will find the conditions unacceptable.
I should like to say something to the credit of the Ministry of Defence. I have had correspondence with the Secretary of State about its obligations to wildlife. The magazine that it has produced, "Sanctuary", is excellent and contains many good ideas. I make a special appeal for consideration to be given to whether the island of Gruinard, ungrazed for 40 years, which is in the possession of the Ministry of Defence, should be registered as a site of special scientific interest. I make no complaint about the time that Ministers have taken in dealing with my letter on the question of Gruinard..
However, I devote my speech to one subject. For the sake of the Ministry of Defence's good name, there should be a public inquiry into Kincora boys' home, and the systematic rape of boys in care.
In my intervention this afternoon, the Secretary of State asked me for new evidence. Paul Foot's book, "Who Framed Colin Wallace?" has not been answered.
The issue that interests me is whether the security services and the Army knew what was going on at Kincora in 1974. Major Wallace says that they did. He sent a memorandum dated 8 November 1974 to his colleagues spelling it all out very clearly and calling for something to be done. If the memorandum is genuine, clearly the Army knew about Kincora, as did several other people in Government. I am not making a party issue of this because for much of the period a Labour Government were in office. Nothing was done about the memorandum until 1980. The Terry report, which was never published, and the Hughes inquiry report, which was, dismiss any possibility that the Army or intelligence knew of the abuse at Kincora before 1980.
Terry does not say how he arrives at his conclusion. Hughes has a passage on Wallace's document in which he suggests, from a Royal Ulster Constabulary forensic report that the RUC refuses to confirm, that the document may have been a forgery. He says that two typewriters may have been used. Evidence is available from typewriting


experts, particularly R. W. Radley, that the same typewriter was used. That calls into question a major part of the Hughes inquiry and is a clear indication that many people, including Major Wallace, knew perfectly well that boys were being systematically raped at Kincora and that nothing was done about it.
There are clear signs that a significant number of people in authority knew perfectly well that boys were being systematically raped at Kincora, but that nothing was done about it.
Do Ministers now accept the authenticity of all, or part, of Peter Broderick's statement?
Was the Broderick statement that was submitted to Downing street on 1 November 1984 identical to the one submitted to the Civil Service appeal board in October 1975?
Do Ministers adhere to the claim that
There is not a shred of evidence to support any of Colin Wallace's allegations"?
I ask solemnly and specifically whether Ministers say that there is not a shred of evidence to support Wallace's submissions in November 1974 on Kincora.
I thank the Ministers of State for the Armed Forces, who, courteously, is present, for his letter dated 16 September. For the sake of time, I shall give the reference —(AF)/AH/9/4/1. He says:
I can confirm that Mr. Broderick did make a statement to the Appeal Board, and that the quotations to which you refer in this context match the content of MOD records.
The Minister continues:
Your final question related to the 'episode of the pistol' outlined in pages 125 to 127 of Mr. Foot's book.
Very properly, a copy of that letter was placed in the Library. Therefore, anyone who is interested can refer to that paragraph.
Why does the Minister leave out certain key information? For example, why does he fail to say that, when Major Colin Wallace was interviewed by the Army special investigation branch in 1977, he was informed that the RUC had lost not only his firearms file but the entire records of the firearms dealer from whom he had purchased the pistol?
Why did the Minister not say that the dealer in question was the main supplier of personal protection weapons to the security forces in the Belfast area?
Why was it that, although Wallace's pistol had been lodged in the Lisburn garrison armoury from April 1970, it was not until October 1977 that anyone noticed that the weapon had been overstamped with a different number?
Is it not true that all weapons in the armoury were subject to frequent and detailed inspections, during which the serial numbers were checked?
The Minister's letter dated 16 September confirms that there was an official "dirty tricks" unit at Army headquarters in Northern Ireland during the 1970s.
I believe that we may be dealing with a very nasty scandal. [Interruption.] I do not know what the Government Whip said, but I am not making a party point because I believe that this is a House of Commons matter. In all my contributions to defence debates I have been concerned about the good name of the services.
The scandal should be exposed. There should be a public inquiry into Kincora and the case of Colin Wallace, or at least the recall of the Hughes inquiry. I say to the

Government Whip and other hon. Members that I personally believe that the uniformed British Army has behaved properly in a most difficult situation.
The 1970s may be regarded by some as stale kail, but I believe that what happened in the 1970s in Ireland is relevant to what is happening in the 1980s. At the very least, senior officials of the Ministry of Defence should invite Major Colin Wallace and Major Fred Holroyd to see them if they are not prepared to have a public inquiry.
I was initially sceptical about this case, but I believe that it raises important matters of principle and should be considered seriously within the Ministry of Defence.

Mr. Julian Brazier: The position adopted by the Opposition Front Bench on this issue has been effectively demolished by Conservative Members, by Opposition Back Benchers and in particular by the hon. Member for Glasgow, Govan (Mr. Sillars). Therefore, I will not spend much time discussing that position. However, I want to pick out one point made by the hon. Member for Clackmannan (Mr. O'Neill).
The hon. Member for Clackmannan alleged that Britain was the odd one out in NATO and he used the old trick of comparing two lengthy documents of detailed points. I presume that he made that allegation to try to cover up the obvious points made by the Government Front-Bench spokesman that the British Labour party is out of kilter with virtually all mainstream European political parties on a range of different issues, not least economics.
The hon. Member for Clackmannan was wrong and it is essential that we understand why he was wrong. He said nothing about France which is a signatory to the Western Alliance and a member of NATO although not of the integrated command structure. The French insist that the force de frappe should remain an essential part of its national defence so long as the Soviet Union has nuclear weapons. Even more important, the hon. Gentleman said nothing about public opinion in the United States which is becoming increasingly disillusioned by people in Europe whingeing about the presence of American nuclear weapons when America has such a large financial commitment and a large commitment in the form of American lives, some 300,000 people—to the defence of Europe.
Two fundamental points can be made. Again and again we have heard Opposition Members say that we are in a new situation and that everything has changed over the past few years. The hon. Member for Clackmannan repeated that, claiming that everything has changed in the past three or four years because of President Gorbachev.
However, the situation has changed, because Britain and its NATO allies stood out and insisted that we should re-arm with cruise missiles and re-equip our conventional forces while the Soviet Union did the same. Throughout that process, Opposition Members decried us, as indeed did some of their colleagues in other countries. President Bush said that the British Prime Minister provided the crucial "anchor to windward" which made the present negotiating process possible.
The older fundamental point is that from where we stand now the difference between the Opposition and the Government is not that we do not want to spend money on arms which could be better spent elsewhere. Of course we


would love to have more money available for other things. However, there is a critical difference of timing. This Government's defence cuts will result from a proper negotiating process—a process which is proceeding at the moment.
The Opposition pledge unilaterally and immediately to cancel the WE177—the air-launch bomb for the Tornado —just when the Soviets are introducing their own equivalent into service. They have also pledged to stop all nuclear testing so that we cannot introduce weapons to balance the Soviets' weapons and they pledge to cancel Trident C4 thus undermining the minimum critical mass, according to the expert advice from the chiefs of staff. We believe that we have the new dialogue now because we decided to take a robust view then and we believe that the dialogue will continue and we will get disarmament on the other side only if we pace our disarmament in tune with theirs.
I want now to refer to the manning problems in the armed forces. We are only just entering the manpower trough resulting from the shortage of 18 and 19-year-olds. Our main problem today lies not with recruiting, but with retention. The recruiting problems remain for the future. I believe that there are three ways in which we can tackle the problems. I want to stress that, whatever problems we may have with retention today, they do not approximate to the problems that existed in 1979 when we took over from the Labour party. The Government have an excellent record on armed forces pay. I want to refer only to issues involving conditions of service which have arisen over a generation instead of over the past few years.
The first issue to be tackled is housing. I will be very brief because I have spoken about this on many occasions. The Armed Forces Pay Review Board is right to state that we will not solve the problems of retention in the Army and the Air Force unless we tackle the housing problem. I believe that the solution does not lie in encouraging more soldiers and airmen to buy their houses while they are in service. Their families are mobile and if they buy houses, their families will want to live in them. That means that the family will be split or the man will leave the services.
As Field Marshal Bramall said in the other place in July, in practice the premature purchase of a house usually leads to premature voluntary release. The Navy's position is quite different because Navy families can be static. There must be an alternative and to be attractive it must involve the same tax benefits as those enjoyed by civilian owner-occupiers.
We must also tackle problems of retention in the Royal Navy. The Navy's problem is different from that in the other two services. The Navy does not principally have a mobility problem. Almost all Navy personnel are deployed in this country and it is manifestly obvious that the wives cannot go to sea with their husbands. There is no point in encouraging accompanied service in the Navy if that simply means wives living at a port which happens to be a vessel's home port. We want to encourage Navy families to be static and to put down roots which help to compensate for the Navy's problem of separation.
Let us make no bones about it: however many battalions there may be in Rouemont in Ulster at the moment—I believe that it is seven—the Navy's separation problems are far worse than those experienced by the other two services. They are in a league of their own. We must be willing to consider a package of allowances as they affect the Navy separately from the other services. Unless

we are willing to acknowledge that the Navy is a special case when we consider boarding school allowances, leave warrants and problems with competitive refits which result in warships being refitted 300 or 400 miles from service men's homes, and acknowledge that the Navy has very different problems with separation, serious problems will continue in the Royal Navy.
At a time when equipment decisions are rightly being made on a centralised basis in the MOD, there is much to be said for getting better value for money if we make decisions on allowances on a decentralised basis which recognises the differences between the three services and the particular problem in the Navy.
My final point about retention relates to social security benefits which, of course, are not an MOD matter. However, they are causing problems and unhappiness disproportionate to the sums involved. Through a series of anomalies which have grown up over the past generation, through a series of different Bills which have failed to state that service in the armed forces is equivalent to service in the United Kingdom, a very unjust situation has developed whereby service men's wives cannot receive the benefits enjoyed by their counterparts in the United Kingdom.
So the wife of someone in the British Army of the Rhine who has paid class 1 national insurance contributions all the way through, and has perhaps done a job for several years in Germany, may find herself unemployed and will then be unable to obtain unemployment benefit. Similarly, the wives of people who come back to the United Kingdom, perhaps after 22 years service—I came across a case recently involving disablement benefit—are told that because their husbands have been working abroad they cannot get any benefit. The sums involved are very small but the disquiet that has been produced within the armed forces is disproportionate.
The common theme in all the points I have made on retention is that the sums of money involved are not large, whereas the sums involved in training replacements are. It would make excellent sense and be better value for money if we were willing to sort out the anomalies and give service men the same deal as civilians by recognising the difference in the nature of their employment. I know that the Government are interested and concerned about this. They have fulfilled in full the pay recommendations of the Armed Forces Pay Review Body every year for 10 years. Their heart is in the right place and we are pushing on an open door. Let us do the little things that make all the difference.

Mr. Harry Cohen: The defence estimates amount to £20 billion this year and will rise to £22 billion next year. All we have had from Conservative Members to justify that are two fictions. The first is that the Soviet Union is rearming, when we all know that the opposite is the case. The second is from a neutral source—the International Institute for Strategic Studies—which states in its definitive annual "Military Balance" that the unilateral Soviet cuts virtually eliminate the surprise attack threat that has for so long concerned NATO planners. Everyone knows that there have been unilateral cuts in the Soviet Union, and there are offers of a great deal more.
The second fiction is the old one of the Soviet threat. It is just a continuation of the old cold war thinking, which


is that we have to have an enemy to justify our high military spending. People say that there could be political changes in the Soviet Union and things could get worse. However, things could get better. The fact that things could get worse is used as a ratchet for expanding the arms race.
I have news for the Conservative party: things are getting better under President Gorbachev. We have a chance to break through the permanent arms race spiral, and we must take it. The Soviet Union also needs that breakthrough, because of its budget crisis. It needs to move the resources from weaponry to its people. We have the same motivation. The Government's arguments are not adequate to justify the huge expenditure.
A previous Secretary of State for Defence, Sir John Nott, described the Ministry of Defence as
a huge supertanker, well captained, well engineered, well crewed, its systems continually updated—but with no one ever asking where the hell it is going.
It is about as well captained as the Torrey Canyon or the Titanic. Judging by the Secretary of State's speech, the captaincy is about to get worse.
Sir John Nott was right about the Ministry's poor direction. It has poor direction in terms of its policy on Northern Ireland. I will not go into that in great detail as it is a subject for another occasion. However, 20 years of continuous war is a statement of its poor direction.
It has poor direction in terms of waste and mismanagement. The Ministry of Defence has been incontinent with taxpayers' money. Many examples have been given today. There is the anti-tank gun that does not pierce armour but which costs £300 million. We could talk of other projects, such as the improved United Kingdom air defence ground environment, the cost of which has shot up from £100 million to £500 million-plus. It is still overdue, and the system does not do what the Ministry of Defence thought it would. Worse than that, it is over a barrel to the multinational defence contractors who intend to charge the Ministry of Defence £1 billion-plus if it wants to get its hands on the software. Those are just a few examples.
The real mismanagement is on the nuclear matters, but I shall deal first with conventional forces. The Ministry of Defence has mismanaged those forces because of a late realisation of obvious demographic trends. It failed to make the necessary changes. The new film version of "Henry V" by Kenneth Branagh uses a new substance called vacform. It is a type of plastic which is ideal for shaping into human bodies for the battle scenes. Because of their incompetence over demographic factors, the Government are trying to run a vacform army.
There is widespread dissatisfaction in the armed forces over pay and conditions. There are fewer personnel, but the Ministry of Defence will not reduce any of the commitments. Therefore, the personnel are put under enormous pressure. Personnel, from captains to lower ranks, are leaving in droves. The Government must face reality and reduce our commitment all over the world, particularly in Germany and Ireland.
The conventional armed forces in Europe talks are going on. With our demographic factors, the Government should be enthusiastic about the talks. They should be pushing for the greatest possible reductions. Even if they do not do so, they will happen, because we do not have

sufficient manpower. So far there is absolutely no British commitment. We are buying more tanks and aircraft and trying to get the narrowest possible definitions in the talks so that we may reduce as little as possible. A wider definition would mean that the Soviet Union would make even greater cuts. The Government's actions are counter-productive. There is no commitment to reduce the number of troops in Germany, and there is little Government policy on the CFE talks. There is poor direction and waste in terms of nuclear weapons.
Of course, the START talks are welcome. If we can get an agreement, there will be a cut of approximately 50 per cent. There are about 6,000 strategic nuclear arms on each side, which shows the ridiculously high number of nuclear weapons now. There has been no British involvement in the START talks—we have consistently gone the other way. We have said that our capable aircraft must be excluded from the cuts. That was insisted upon by the Government.
We are buying the SRAM stand-off missile from the United States, and there is a big expansion in the free-fall hydrogen bomb. In the 6,000 limit under START, in an aircraft carrying free-fall bombs or short-range missiles, the entire weapon load counts as only one unit. The Government are keen on that, because it is a way of getting around the START agreement even before the ink has dried on the paper.
The same applies to the follow-on to the Lance missile. The Senate Armed Services Committee has said that it might recycle those warheads that were formerly on INF missiles on to the follow-on to Lance and then return to Europe. That is legal under the INF agreement, but it is a way of getting around it, and the Government support the follow-on to Lance.
There is nothing under START to tackle sea-launched cruise missiles—there should be, but the Government have set their face against it. Instead of curtailing sea nukes, Britain's contribution is Trident, which will have about 16 MIRV missiles, each with 14 warheads. If we multiply that figure by the four Tridents, there will be about 896 separate targets or warheads. One Trident skipper can unleash the equivalent of 6,500 Hiroshimas. As well as being terribly dangerous, the project is useless, does not work, and is easily identifiable by radar. Huge ships carry that sort of weapon load, and even the United States is curtailing it.
The Tory policies are a disaster. Conservative Members proclaim their defence policies even though they are a miserable and expensive failure. They are unattuned to world trends, needs and people's desires. All we heard from the chairman of the Conservative party at the Conservative conference last week was a question to Labour:
At the end of the negotiations will Labour get rid of all Great Britain's nuclear weapons while the Soviet Union retains some of theirs?
That is the argument that Conservative Members will try to use in the next election. It is a ridiculous question. If we all say that we will keep the last weapon, there will never be any cuts and we will never get rid of the world of nuclear weapons. It also makes the ridiculous assumption that Britain and the Soviet Union are the two nuclear super-powers. Of course, the United States, not Britain, is the nuclear super-power. It is up to the United States and


the Soviet Union to enter negotiations and to give up the last nuclear weapon. Our weapons just get in the way of that process.
A question arises for the Conservatives: if the Soviet Union gets rid of all its nuclear weapons—and that is President Gorbachev's avowed aim for the year 2,000—will the Tories get rid of Britain's nuclear weapons? We have had an answer from the Prime Minister. The answer is no, they will not. They want to keep nuclear weapons forever. They say that we cannot disinvent nuclear weapons. We cannot disinvent gas chambers, either, but we can disavow them.
They say that nuclear weapons have deterred war for the past 40 years, but that is not the case. President Reagan said:
Nuclear deterrence is too risky to rely on long-term.
How do we deter a nuclear accident from occurring? That was cheap, slick propaganda and I am sure that we shall hear more of it. Tory policy is useless and does nothing to reduce the risk of nuclear catastrophe. On the contrary, Tories proudly proclaim their commitment to rearmament and modernisation regardless of world events.
I support the policy of reducing our defence expenditure to the same percentage of GDP as that in the rest of Europe. That would release over £5 billion per annum for peaceful purposes. We devote 55 per cent. of our research and development spending to military projects. In Japan the figure is only 2·5 per cent. It is no wonder that it is an economic powerhouse while our economy is lurching into crisis. To cut military expenditure is the way to transform our economy, expand our health and welfare services and release resources to tackle poverty, disease, ecological disasters and international debt which racks the world. The Tories do not have the answer. Their priority is more worthless armaments.

Mr. Roland Boyes: We have had a good first day's debate on the defence estimates. Some hon. Members have expressed long and deeply held views and they are respected for them. We have had speeches from other hon. Members who have campaigned for peace in different ways over many decades. Many points were made with which I fundamentally disagree, but the debate benefited from a series of well-informed speeches. I do not intend to comment on every speech, although I missed only one and a half of them.
We welcome the new initiative of a centre for defence studies. I hope that it will be properly funded so that reports can be prepared without pressure.
As a postgraduate of Bradford university, I took exception to the cheap remarks made by the hon. Member for Colne Valley (Mr. Riddick). I hope that the Secretary of State will mention to him that all hon. Members defend academic freedom.
The Secretary of State commented on the new opportunities for understanding and spoke of the massive reduction and eventual elimination of chemical weapons. He also recognised the professionalisation of the forces. I, too, shall mention that, but in a slightly different way.
Nothing has been said today about the warship programme. Many companies wonder what is happening. I hope that the Minister will speak about it and will have some good news and assurances for us tomorrow.
The hon. Member for Kingswood (Mr. Hayward) is not in his place but my hon. Friend the Member for Clackmannan (Mr. O'Neill) is back. I invited the hon. Gentleman to read the whole speech on conversion instead of the distorted and selected examples from it which he used to make a narrow point. I hope that the Secretary of State will encourage him to do that.
The hon. Member for Glasgow, Govan, (Mr. Sillars) made a long diatribe against the Labour party's policy, not recognising that our policy has changed in response to the change in the international situation. That diatribe was a bit much, coming from the hon. Gentleman. He talked about my right hon. Friend the Member for Islwyn (Mr. Kinnock) making U-turns when, to my knowledge, the hon. Member for Govan has been a member of the Labour party, left that to form another party and ended up in the Scottish National party. I wonder where his career will eventually end. On the strength of the speech he made today, I fancy that I may see him on the Conservative Benches in the near future.

Mr. Sillars: Is not the hon. Gentleman aware that it is much better to change party because of one's principles than to change policy because one has no principles?

Mr. Boyes: One of the most striking things about SDE89—I shall use that acronym instead of saying "defence estimates" every time—is the wealth of evidence that it presents on the failure of this Government's much-vaunted procurement reforms. When Sir Peter Levene was appointed as Chief of Defence Procurement. amid much controversy over his inflated salary and the unconventional method of his appointment, he made reductions in the cost of defence procurement a top policy priority. However, the Government's record on containing the costs of weapons programmes is abysmal.
A brief glance at some naval projects listed in the major project statement in the 1989 document shows that the costs of the type 23 frigate programme have increased by 26 per cent. since last year and planned peak expenditure had been extended by one year to 1993, no doubt presaging further delays and cost increases. The troubled Upholder class diesel submarine is one year later than was predicted last year. The cost of the vertical launch Sea Wolf has risen by a whacking 168 per cent. and that of the sonar 2054 programme is up 29 per cent. on last year.
The Government have also regularly boasted about the number of jobs that defence spending creates in this country. However, as befits a party that has no commitment to maintaining employment levels in any of our key industries, the Government's boasts are hollow, as is shown by the 1989 document. In last year's White Paper the Government claimed that 350,000 jobs were dependent on defence procurement. They do not repeat that claim this year. Why? Well, if one cares to delve deep into the statistical volume of the 1989 White Paper, one finds that the number of jobs dependent on procurement is now only 310,000–11 per cent. lower than last year's figure. In 1979, when the Government first took office, the figure was 400,000. There has been a drop of over 20 per cent. in the seven years covered by the data. So much for Tory support for the defence industries.
This year's White Paper shows that the equipment budget will be only 41 per cent. of total defence spending in the current financial year as against 43 per cent. last year. That is an all-time low since the Government took


office. With continued pressure to improve salaries and conditions for personnel in the armed forces, Sir Peter will have great difficulty in maintaining even those levels of procurement spending.
At this stage it might be opportune to digress a little to discuss manpower, which many hon. Members have mentioned. The retention of manpower in the armed forces is an area of concern to the Opposition. The 1989 document contains a cautious and typically euphemistic admission that this is an explosive situation, stating:
Recruitment was more difficult in 1988–89
and:
retaining trained manpower has also been more difficult".
Last year's "Statement on the Defence Estimates" showed that premature voluntary release rates in 1987 were 3·1 per cent. for officers and 2·7 per cent. for other ranks. It then pointed out that those levels were
fairly stable and compare favourably with previous years".
However, the 1989 figures show that the PVR figure rose in 1988 to 3·3 per cent. for all personnel.
Those figures are bad enough, but the figures for applications for PVR show an even greater rise from 1987 to 1988. That means that a lower proportion of those who have applied to leave the services early are being granted release. I hope that the Minister will see that that is a dangerous and short-sighted policy. Simply forcing people to stay on when they do not want to stores up ill feeling and resentment and is highly unlikely to reduce the rates of PVR applications as morale will decline and other personnel will see at first hand that those with grievances are not being dealt with sympathetically.
I am happy to see from the statistics in the 1989 report that the Royal Navy is doing rather better in terms of recruitment and PVR rates than in previous years, but that does not mean that the problems have disappeared. People on press and parliamentary visits to Royal Navy ships and establishments are still being taken aside by Commissioned and non-Commissioned personnel alike, told that the salaries and conditions are inadequate and urged to do something about it.
I have experienced some aspects of that. During the Richmond by-election, I went round the Catterick camp. I do not know whether action has been taken at that camp recently, but the condition of the houses was quite horrific. They needed much repair and gallons of paint. It is not right that service personnel should have to live in such conditions.
The Daily Star of Wednesday 11 October had a full page headed
The bitter legacy of loyalty.
The article referred to "brave Lynda Lewis" and said that she
is fighting a desperate battle against the crippling disease multiple sclerosis. Her world is a hospital bed. She is trapped there because of a red tape wrangle which denies her husband the money to pay for her to go into a nursing home. Now the pride that has sustained Staff Sgt. Robert Lewis through 17 years of service is cracking under the strain of watching his wife's pain … and a growing feeling of betrayal.
The article also mentions—I shall not go into detail—army wife Sue Brett, who is
plunged into a social security quagmire.
If the Minister gets hold of this paper, he will see that there are many more complaints.
When my hon. Friends and I were at a NATO meeting with senior military personnel, they talked to us about the

problems of holding highly trained, highly skilled staff. The brigadier to whom we were speaking put it to us that there were a variety of reasons why people did not want to stay in the forces. I am sure that the Secretary of State will take an early opportunity to talk to senior military personnel about why there are so many who want to leave the forces at present. The cost of training highly skilled, professional military people and then of losing them so easily shows that the Government should look carefully at why their policies are leading to that position.
The Secretary of State mentioned chemical weapons and the hope of eliminating them. This country has enormous potential to play a positive role in many different areas of arms control. Some of that potential has been apparent in the past in the chemical weapons negotiations, and promising progress has been made. There have been some welcome developments on the Soviet side. At the United Nations last month, the Soviet Foreign Secretary said that he favoured an immediate halt to poison gas production. At the Paris conference in January, he announced that the Soviet Union was beginning to destroy its existing stocks of chemical weapons.
Meanwhile, considerable progress was being made in the negotiations at the conference on disarmament. In August, the Soviet Union met one of the long-standing objections of the United States on verification by agreeing to challenge on-site inspections of suspected chemical weapons facilities before a treaty is signed, not just after it comes into force. This development should have satisfied the Americans and our own Government that it would now be possible to verify the claim of the Soviet Union that the stockpile is only 50,000 tonnes.

Mr. Mates: Untrue.

Mr. Boyes: Technical experts—from who we got our information—appear to be in agreement that the technology exists for proper verification of a comprehensive chemical weapons ban.
President Bush, apparently responding to the allegations that the Soviets are always making the running on arms control, announced last month in his United Nations speech that the United States was prepared to cut 80 per cent. of its chemical warfare stocks, pending completion of the treaty, although binary weapons production would continue until all likely chemical weapon possessor countries had signed a comprehensive treaty. There is a long list of countries that have chemical weapons or have a chemical weapons potential. We all accept that getting some countries, such as Iraq, to sign such a treaty is a serious problem. We all agree that these are obscene weapons. All of us must work as strongly as possible to rid the world of them.

Mr. Sayeed: Like other Conservative Members, I share the aim of eliminating chemical weapons. Can the hon. Gentleman say who these experts are and in what publications we can read such pieces of expertise?

Mr. Boyes: I shall write to the hon. Gentleman.
Amid all the applause that greeted the statement, I was worried, as it implied that the United States would never give up chemical weapons production as long as any country was assessed to be capable of producing chemical weapons.
President Bush's statement was upstaged yet again by the Soviets when the Foreign Secretary announced that the USSR was prepared to give up all its chemical weapons —not just 80 per cent.—pending signature of a treaty. Last week we heard the shattering news that the United States would keep producing chemical weapons even after a treaty was signed. The announcement did not mention whether this was contingent on what other countries were doing.
This point was made in an article printed in The Guardian on Tuesday 10 October. It stated:
Analysts and US officials criticised Mr. Bush's decision, which they said would encourage other countries to match the US effort, contributing to poison gas proliferation.
It is obvious that the 80 per cent. of chemical weapon stocks which the United States says that it will give up will consist entirely of the unitary munitions which the Pentagon has been arguing for years are militarily useless, obsolete, leaking and dangerous. That can hardly be described as an arms control initiative. Now we know that the other 20 per cent., which are currently old unitary weapons, are simply being reserved for the binary weapons which will be produced indefinitely.
President Bush says that he has a strong emotional commitment to ridding the world of chemical weapons. In fact, The Washington Post of 21 October quotes him as saying during the campaign for the presidency:
'If I'm elected president, if I'm remembered for anything, it would he this: a complete and total ban on chemical weapons,' Bush told students at the University of Toledo. 'Their destruction forever. That is my solemn mission.
The events of the past couple of weeks contradict what Bush said at that time. I am sure that my feelings are shared by all hon. Members: we all want Presidents Bush and Gorbachev to agree to rid the world of these weapons.
If President Bush wants to be remembered for
a complete and total ban on chemical weapons",
he will have to change his mind. As Vice-President, Bush used his tie-breaking vote in the Senate to support the go-ahead on binary weapons production, to which his mother strongly objected. His emotional commitment to chemical weapons is rather stronger than his emotional commitment to banning them.
Let us step back for a moment to consider what possible logic there is for this new United States position. Presumably, the United States thinks that it is necessary to continue producing chemical weapons to deter other possessor countries from using them. Think of the countries who are likely to use chemical weapons, such as Iran and Iraq. For the most part, they do not enter into direct combat with the United States of America—certainly not the sort of mass land combat which lends itself to the use of chemical weapons.
If the fact that the United States currently possesses chemical weapons did not deter Iran and Iraq from using those weapons, how can it be any different in future? If the United States' stockpile of chemical weapons does not work as a deterrent merely by its existence, we can only assume that a deterrent effect can be achieved only by demonstration and use of the weapons; but not even the most rabid anti-American would accuse them of being so stupid as to use chemical weapons against a country that had not used chemical weapons against United States troops or citizens.
President Bush has become a hostage to the strong pro-chemical lobby inside the Pentagon. There is no logic to its position. It is simply composed of people who have

built their careers on chemical weapons. We must be positive, even in the face of such depressing developments from our principal ally.
I pay tribute to the fine work done by our own negotiators in Geneva on a convention to ban chemical weapons. I appeal to the Government to make it known to President Bush that Britain does not support his commitment to the continued production of chemical weapons. I hope that when he next speaks to his United States counterpart the Minister will make it clear that this latest United States announcement will make nonsense of any chemical weapons convention, as it will encourage many more countries to start building chemical weapons before a treaty comes into force, quite apart from the effect it will have on the Soviet attitude towards the Geneva talks.
The new US policy on chemical arms control will be a major test of our Government's seriousness about a negotiated disarmament. We should either make it plain to the Americans that we are serious about ridding the world of these insidious weapons, or we should throw away any potential we have to influence positively world events.
I wish to raise a significant question, which arises from the 1989 "Statement on the Defence Estimates", about the role of the Royal Navy's Polaris submarines. Over the years there have been a number of statements by Ministers and officials to the effect that no Polaris submarine has ever been detected or tracked when on patrol. They have always created the impression that Polaris operates in an entirely independent and self-reliant manner, using stealth to avoid detection rather than relying on other systems such as aircraft and hunter-killer submarines to provide anti-submarine cover.
In the 1988 "Statement on the Defence Estimates", however, a new role appeared for the Royal Navy—the deployment of our strategic deterrent. This year, that role appears as the first of the Navy's three tasks, in front of the containment of the Soviet northern fleet and the protection of reinforcement shipping. This is an amazing revelation: Polaris is not self-reliant at all, but requires a major effort by Royal Navy and Royal Air Force units to protect it.
Since this is now stated officially in the "Statements on the Defence Estimates", will the Minister tell us what level of resources is being expended on the protection of Polaris submarines on patrol? If has been a convention that the cost of Britain's strategic nuclear forces is limited to the capital and operating costs of the Polaris and Trident fleets. It now seems that we should add some of the costs of anti-submarine patrols by ships, aircraft and other submarines, including perhaps part of the capital cost of building some of these vessels.
Does the Minister recognise that this is a fundamental issue? The Minister should explain to the House why the role of protecting the deployment of our strategic deterrent has never been mentioned in the annual "Statements on the Defence Estimates" until 1988, but is now the first of three roles played by our maritime forces. Has Soviet open-ocean anti-submarine warfare suddenly advanced strategically in complete contradiction of US intelligence evidence, which suggests that it has not? Have the hundreds of millions of pounds that have been spent on Polaris refits in recent years failed to produce a vessel that can operate independently and without fear of detection?
The Secretary of State's speech was confused, contradictory and lacking in essential detail. He ignored the big issues, such as Ferranti and the new frigates.

Mr. Tom King: I dealt with Ferranti.

Mr. Boyes: Only when he was pressed on it did the Secretary of State——

Mr. O'Neill: After.

Mr. Boyes: Only after he was pressed did the Secretary of State volunteer anything on Ferranti. We have been told nothing about the new frigate programme, and I hope that the nodding of the head of the Minister of State for Defence Procurement means that we shall have an important announcement tomorrow.
In the struggle for peace, it is clear that only the Labour party has the strategy, the will and the policies that will allow our generation to pass on the earth to its children. That is why it is essential that we rid ourselves of the Government; and, according to the opinion polls, we are well on the way to achieving that objective.

The Parliamentary Under-Secretary of State for Defence Procurement (Mr. Michael Neubert): After three months of the summer recess, and even longer since our last extended debate on the subject, after the rapid, not to say dramatic, developments in East-West relations and after the extraordinary public outpourings of popular feeling in eastern Europe and beyond, it is no surprise that today's discussion has ranged widely over issues of more than usual interest and topicality. In the time that is allotted to me, I shall try to comment on a number, although not all, of the points that have been made today. I shall also make some comments of my own.
I am sure that the hon. Member for Houghton and Washington (Mr. Boyes) knows that the policy issue of frigates and warships will be taken up tomorrow by my hon. Friend the Minister of State for Defence Procurement if he catches your eye, Mr. Speaker.
Since we last met, my responsibilities have changed. In a widely unpublicised postscript to the Government reshuffle, I have moved across the Ministry of Defence to become the Under-Secretary of State for Defence Procurement. My hon. Friend the Member for Plymouth, Sutton (Mr. Clark) the Minister of State, will deal with the full range of our present projects for all three services and procurement policies in general, and points appertaining to them that have arisen today, when he opens the second day of the debate tomorrow.
I shall draw attention to the equally important work going on within the MOD to improve cost-effectiveness and efficiency in the conduct of our business. My right hon. Friend the Secretary of State highlighted some of the main features of this. He gave the broad picture. If the Chamber of the House of Commons were to be compared with the Sistine chapel, he would be Michaelangelo and I would be some dauber in the dark corners. However, I hope to add something to the report to the House that we are making today.
Before I do so, I shall return to the subject of housing, which preoccupied me in my previous armed forces post. In the debate on the Army held earlier this year, I described the assistance that we provide to service men who wish to become home owners and I know that this is a topic of interest and concern to many hon. Members, most especially my hon. Friend the Member for Canterbury (Mr. Brazier), who has made this his subject.
The hon. Member for Clackmannan (Mr. O'Neill) is now trailing behind my hon. Friend in his enthusiasm for the subject.
It can be argued, and rightly, that, provided that the pay and allowances of service men are comparable with those in civilian employment, they are as well placed as any to enter the housing market. The measures that I described then recognise that many service men have bought and will continue to buy their own homes. However, there is no doubt that, because of the mobility that we require of our service families, particularly in the Army, the service would-be home owner may face practical and financial difficulties that his civilian counterpart generally does not. Of particular concern is the position of the long-serving service man, who finds towards the end of his engagement that the council house that he might have been assuming would be available is not and that he is not easily able to afford a decent family home.
I told the House earlier in the year that one idea which we were actively considering was the establishment of a scheme involving a housing association or associations. I am glad to say that we have now carried that work forward to the point at which we have decided in principle on the outline of a trial scheme and we are about to get down to the detailed work with housing associations. Our aim is for the trial scheme to offer about 60 to 70 homes, with flexible arrangements to buy and/or rent, which will be targeted at longer serving Army NCOs.
I would not suggest that this one step alone will have a huge impact, and not until we are able to evaluate the success of the trial shall we be in a position to decide whether, and if so how, we might take it further. I hope that hon. Members will take this as a demonstration of the importance we attach to this issue and our willingness to explore new approaches.

Mr. Brazier: I am certain that hon. Members on both sides of the House will welcome the fact that the Ministry of Defence is taking a modest step towards trying to do something about the social problem of those who find at the end of their service that they are homeless. However, even if it were to provide several thousand houses, they would be rapidly filled. The problem of those who have already left has nothing to do with the principal problem of premature voluntary release, which is offering a man who joins the services now, or who has joined recently, an alternative to house purchase as a route to owning his own home at the end of his service. As Field Marshal Lord Bramall said in the other place in July, premature purchase of a house leads all too often to PVR. I put it to my hon. Friend the Minister, as he knows only too well, that tax changes will be required if such a scheme is to be attractive.

Mr. Neubert: The scheme is proposed as only one contribution to a range of possibilities for helping serving men and women provide their own housing. It is not intended to answer all the questions that my hon. Friend constantly puts before us.
My hon. Friend the Member for Hampshire, East (Mr. Mates) expressed concern about the application of the community charge to service men. When I first came into post in December 1988, it was a letter to him on this subject that was among my first duties. It is a complex matter that is perhaps not easily discussed on the Floor of the House. My hon. Friend's point is taken, but the decision had been made. It is one that involves shielding


the serving man and woman from the worst excesses of high-spending local authorities by reason of the requirement for mobility and location in such authorities without removing the general principle of accountability, which is the purpose of the scheme.
My hon. Friend the Member for Hampshire, East is concerned also about shortage of civilian staff. In this he was joined by the hon. Member for Blaydon (Mr. McWilliam). It is true that shortages cause delay in the day-to-day business and lead to slippage in equipment programmes. In response, we redeploy resources to meet urgent needs. Our remedies have been outlined in the report of the Select Committee on Defence. Perhaps the Committee did not give sufficient credit to us for our initiative, which we hope will bear fruit.
turn to the recurrent theme of value for money. In his opening speech, my right hon. Friend the Secretary of State touched on our New Management Strategy for Defence. This has profound implications for the way that the Department is run, and I should like to say a little more about its history, and about what we aim to achieve.
As the White Paper notes, this is the 25th anniversary of the unified Ministry of Defence. A succession of important organisational changes have followed to reinforce this unification, so that corporate decisions on policy, priorities and on resource allocation are taken within a common defence framework.
This process of reinforcing the centre was consolidated in the reorganisation initiated by my right hon. Friend, the Member for Henley (Mr. Heseltine) in 1985, under which the responsibility for advising Ministers on the future size and shape of the armed forces was passed to a centralised defence staff, and an Office of Management and Budget. But the 1985 reorganisation had a second and no less vital purpose: to create the framework for the decentralisation of responsibility for day-to-day management of the defence resources allocated. In short, this means the maximum delegation of management authority, down clear lines of accountability to commands and outstations.
This last aim—delegation—has been on the agenda for some time. As long ago as 1901, the Esher committee complained that, to use its words,
the entire system of War Office finance … is based on the assumption that all military Officers are necessarily spendthrifts, and that their actions must be controlled … in detail by civilians".
Responsibility for managing resources on the ground remains strictly separated from financial control of those resources. As a result, although our present systems of financial control are relatively cheap and effective, they can stultify managerial initiative. As a result of our reforms, the conditions are now ripe to put that right, and thereby to provide the means of releasing the energies and abilities of managers, both military and civilian, who are close enough to the action to know what drives the costs, but who, hitherto, have been shackled in performing their tasks by the remote system of financial control and by over-detailed instruction and direction from above.
That, then, is where the new management strategy comes in—to provide a framework within which financial responsibility can be more closely aligned with executive authority, to delegate day-to-day management and, therefore, to complete the design that was outlined in the 1985 reorganisation. The ultimate aim is much more

efficient management of our operating costs to ensure that we can continue to afford the defence that the nation needs and the necessary investment in vital new equipments.
I shall not go into great detail about the mechanics of the NMS, some of the detail of which is set out in the Defence Committee's perceptive report. It is gratifying that it welcomes the strategy. Broadly, we intend to achieve our aim through a threefold programme. First, we will allow our managers new ways of managing. Our new system of budgets, delegated throughout the Department. is aligned closely with the command and management structure itself. Line managers will be given considerable flexibility to decide for themselves how best to achieve their tasks, thereby making the best use of their ability, energy and initiative. That offers real freedom to our managers to get on with their jobs, unfettered by needless control. As the Defence Committee has recognised in its report, effective delegation will be crucial for the new management strategy's success.
Secondly, we will give managers the necessary technical assistance. That will include the system of budgets that I have already mentioned; a new and more systematic system of planning under which objectives are made clear; targets for achievement set through management plans that define managers' objectives; and advanced management information systems.
Thirdly, there will be new structures—and here I am referring to the establishment of the defence support agencies that my right hon. Friend announced in his speech this afternoon. That will not lead, as the hon. Member for Clackmannan suggested, to privatising apprenticeships in the armed forces. The support agencies will remain within the Ministry of Defence, and they will be discrete bodies within the organisation. That will allow us to reap the benefits of the Government's "next steps" initiative, while recognising the particular circumstances of defence.
Our organisations are highly interdependent because, ultimately, we have—to use the jargon—a single output, the defence of the realm. The concept of defence support agencies will ensure that the organisations continue to be regarded as integral to the fabric of defence, not least because of their roles under operational circumstances within the chain of command.

Mr. O'Neill: That point was recently put to me by some members of the defence unions who were concerned about their career prospects. They believe that, having been civil servants with the Ministry of Defence, if they continue to be employed they will become the employees of agencies that will be responsible for the training of young soldiers doing service apprenticeships within the armed forces. Can the Minister confirm that that is what will happen, because I understand that it is now the subject of negotiation with the trade unions?

Mr. Neubert: Yes, and that is where it should rest for the moment. These are new proposals and we have other proposals. It is important that they should not be confused and that each should be taken on its own.
In addition to a wide range of defence support agencies we are, of course, proceeding with our plans to turn into full "next steps" agencies the two major candidates that we identified shortly after the publication of Sir Robin Ibbs's report—the Meteorological Office and the non-nuclear research establishments.
As the House will be aware, I announced recently that the Meteorological Office will assume executive agency status in April 1990.
The Meteorological Office already has worldwide renown for its contribution towards meteorological and environmental matters. It is well known to millions, but not everyone is aware that it is in fact part of the Ministry of Defence. Of those associated with the Ministry of Defence, the television weather forecasters are probably the best known and the most popular—present ministerial company excepted.
The Meteorological Office is part of the Ministry of Defence because much of its work involves direct support of all three services, a role which would become particularly crucial in wartime when weather conditions can be of vital operational importance. Therefore, we have decided that the new agency will remain within the ambit of the Ministry of Defence.
Nevertheless, I am anxious that the Meteorological Office should have every opportunity, within that necessary constraint, to manage its own affairs. It will have a new charter, and we will give it peformance targets to encourage a new management approach and to stimulate greater flexibility and openness toward commercial opportunities. I intend that the Meteorological Office should, as necessary, recruit business and commercial talent from outside. That will complement the unique scientific expertise that the Meteorological Office already had.
Our aim in establishing the Meteorological Office as an agency is to improve its management and commercial skills, while retaining the high technical and scientific standards that have placed it as a front runner in its field. This will provide a better service for all its customers, civil and military, and give the Ministry of Defence better value for the operating costs of the Meteorological Office, which amount to some £80 million a year.
The House will recall the announcement on 16 March this year by my predecessor, my hon. Friend the Member for Hove (Mr. Sainsbury), of the Government's intention to establish a defence research agency, made up of the four principal defence non-nuclear research establishments. Those are the Admiralty Research Establishment, the Royal Aerospace Establishment, The Royal Armament Research and Development Establishment and the Royal Signals and Radar Establishment. The Atomic Weapons Establishment will not be included, but we are considering whether other areas within the Ministry of Defence, such as test and evaluation facilities, should also form part of the agency.
We have appointed a chief executive designate, through open competition, to manage the four establishments that will make up the DRA and to prepare the organisation for agency status. Detailed work, of which there is a great deal, is now well under way.
Our aim in establishing the agency is again to get better value for money from our expenditure on defence research and project support. We see this being achieved by a sharpened customer-supplier relationship, and by allowing the establishments greater freedom to manage their resources in response to changing customer requirements. The DRA's primary function will continue to be providing the Ministry of Defence with technological support and

independent advice. But we will encourage it to widen its customer base, so as to make the best possible use of its intellectual and physical resources. At the same time, it will be very important to maintain the confidence of industry and of our international partners in the impartiality and commercial confidentiality of the agency.
Our intention remains to establish the Defence Research Agency within the public sector, as the hon. Member for Clackmannan noted. I hope to be able to clarify its precise status and composition by the end of the year. Target vesting day is in the spring of 1991.
Let me deal now with a particular management initiative which has saved the Ministry of Defence many millions of pounds over the last ten years, and that is contracting out or "contractorisation".
It is by now a well established principle that the Ministry of Defence should transfer to the private sector any work that does not need to be retained in-house for operational reasons, provided, of course, that it is in the taxpayers' interests to do so.
In recent years, we have extended what we call the -market testing" of defence support services, from the traditional areas—such as cleaning, catering and ground maintenance—to the less obvious, such as range operation, bird control at RAF stations, and the management of aircraft storage. We are also now looking at a new development—facilities management—which would involve larger, all-embracing, support contracts, whereby one contractor would be responsible for providing a whole range of support services at an establishment.
I should point out here that market testing does not, as is often claimed, automatically lead to a task being contracted out. In some cases the mere discipline of subjecting activities to competition has achieved considerable economies in the in-house operation, so making it cheaper and more cost-effective than the private sector. Nor is cost the only consideration.
Nevertheless, we reckon that, since 1979, contracting out defence services has made net savings that now run at some £50 million a year. The MOD is recognised as a leader in that field within Government. It handled about 70 per cent. of all market testing done by Government Departments in the last financial year.
Whilst it is obviously important that we obtain the best value for money in managing the defence budget, we do not, and must not, allow that to override the operational needs of the services. In looking at what tasks might be contracted out, we give full weight to operational needs, and we accept that many tasks must, for operational or security reasons, be performed in-house.
The terrible events at Deal last month have caused some people to suggest that we have gone too far in putting security tasks out to the private sector, but it would be wise not to rush into hasty judgments and to wait until our examination of the circumstances surrounding this incident is complete. Even if we decided that, for the future, the use of contract security personnel should be restricted that is only one small part of our support activities. There will still be many other areas in which contracting out—provided that it meets the operational and security criteria—will offer a highly effective means of making the defence budget go further.
To answer the hon. Member for Clackmannan, this matter was raised by the husband of the hon. Member for Peckham (Ms. Harman) at the joint Whitley council. I was


sorry to disappoint him, but I had to say that as far as contractorisation was concerned, each proposal was considered on its merits, and the concerns that he voiced at that meeting and which have been voiced here today are properly part of that consideration. A review was under way but even while it was under way I could give no guarantee that proposals for contractorising services over a wide range of options would not be implemented. It would be wise, as I said before, not to rush to judgment on matters whose circumstances we cannot know. We would do better to await the outcome of the inquiry.

Mr. McWilliam: I do not wish to rush the Minister over any fences, but I wonder how he can tell the House that, in the face of the fact that the private security company at Deal had been sacked by another Government Department. It seems that the Minister has been singularly badly advised when constructing this part of his speech; perhaps a little less complacency would be in order.

Mr. Neubert: There is no complacency: there is simply the need to establish the facts. I recommend, as I recommended to the husband of the hon. Member for Peckham, that the hon. Gentleman wait for the facts. However, I realise that my answers were not to be allowed to get in the way of a good press release by her husband. It is instructive that the story appeared only in The Guardian and the Morning Star, and if the hon. Gentleman wants to be better informed in future he might stick to the serious papers.
My right hon. Friend challenged the Opposition spokesman to tell us whether the motion carried so overwhelmingly at Brighton by the Labour party conference represented Labour party policy. He was told in answer that it would not appear in the party manifesto. I invite the hon. Gentleman to reconsider his response. Are we to believe that a decision taken on behalf of 4 million people at a Labour party conference——

Mr. Boyes: The same question again.

Mr. Neubert: Everyone is asking the same question because that is the question that we want answered. Are we to believe that this is not Labour party policy——

Mr. O'Neill: I am grateful to the Minister for giving me the opportunity once again to explain this to him. It seems that I must do so to each Minister individually. The motions passed at the Labour party conference are of differing significance—[Interruption.]—and the resolution which was passed without the need for counting, supporting the Labour party's document on foreign affairs and defence, will form the basis of the Labour party's election manifesto. What appears on the Order Paper is of no relevance to what will appear in our manifesto.

Mr. Neubert: We are being asked to believe that the Labour party—that great democratic institution, as Labour Members present it to us, despite their block vote —when faced with a decision of conference by an overwhelming majority of two to one, gives as its answer the classical two fingers. But is that the truth?
We have here the longest amendment I have ever seen from an official Opposition. It is what I would describe as densely worded. It is an impenetrable thicket, no doubt to dissuade anybody from reading through it, but I am charged with some responsibility for the nation's defence so I have struggled through it.
In line 4, the amendment calls for the Government to.. "undertake a Review". We know what that means in Labour party terms. It means a substantial reduction in expenditure. The Opposition would go on to examine the allocation of resources which could be released for social and economic purposes. That is what the official amendment says, but if we want to understand what it means, we should turn to the unofficial amendment in the name of the right hon. Member for Chesterfield (Mr. Benn) and his hon. Friends.

It being Ten o'clock, the debate stood adjourned.

Debate to be resumed tomorrow.

Community Charge (Isle of Wight)

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Lightbown.]

10 pm

Mr. Barry Field: I thank you, Mr. Speaker, for granting me the opportunity of placing before the House tonight the arguments set out in a document entitled "An Island Apart", which seeks to identify the cost of severance by sea for the Isle of Wight. But before I do so, I thank my hon. Friend the Under-Secretary of State for coming along to reply to tonight's debate and congratulate him on the news that his wife is expecting their first baby. I am sure that everyone hopes that he or she will be a Chope off the old block.
My hon. Friend is, of course, a near neighbour, representing a Southampton constituency. I should like to place on record the considerable assistance that he has given me, particularly in the correspondence we have had about the planning considerations for the Isle of Wight's terminal at Portsmouth, Southampton and Lymington, especially as some of them appear to be under pressure for redevelopment.
I am also glad that my hon. Friend will have the opportunity of replying to tonight's debate, because, like me, he has enjoyed the privilege and pleasure of serving as a local councillor before his election to the House. I know that that knowledge will bring a special understanding and comprehension of the island's problems.
The document "An Island Apart" was prepared in January 1989 and was submitted to my hon. Friend the Under-Secretary of State together with a personal letter from me.
I should like to pay a particular tribute to the retired county treasurer, Don Tuck, who worked so hard on the document and who has led successive delegations to Whitehall. It is worth recalling that in 1978 he obtained the agreement of the Department of the Environment statisticians that special costs did exist, and the then Secretary of State was prepared to do something to compensate for those costs, provided that the Association of County Councils agreed. However, it has always been the policy—in my opinion it is never likely to alter—that the Association of County Councils will not support one individual member in its submission to the Department of the Environment for a special case.
My hon. Friend will see that on page 6 of the document we seek to set out the additional costs that are borne by the island. They include £821,000 for the fire service; £547,000 for waste disposal; £155,000 for further education; £27,000 for vehicles and plant; and the impact of the three prisons on the magistrates courts, which is £95,000. That makes a total of £1,266,000 and, as my hon. Friend will be aware, the Isle of Wight is the smallest county council in England.
As an illustration of the difficulty of obtaining economies of scale, I always use the comparison of staff. Hampshire county council has 52,000 employees, and the Isle of Wight county council has 4,121. From that, I hope that it can be seen immediately that a difference of just £10,000 has a substantial impact on the Isle of Wight county council budget, whereas it takes several millions of pounds for it to be felt on other county councils.
The most easily understood problem facing the island is the need for our fire service to be self-sufficient. All fire

services in the United Kingdom rely on adjoining authorities to give them back-up facilities in the event of a major disaster or fire, but it is fairly obvious that one cannot make a 999 call on the Isle of Wight and expect the fire engine to catch the next ferry from Hampshire.
I understand that the Home Office had confirmed to the Department of the Environment that it is impossible for us to run a smaller or more efficient fire service than that which we currently operate. My hon. Friend the Minister will therefore be able to see that the overspending that is shown up by the methodology under the existing system conspires heavily against the Isle of Wight.
Because of the sensitive nature of the aquifer and the fact that the island is not self-sufficient in drinking water at peak times, more than 25 per cent. of our water supply must be piped in from the mainland. That means that the water catchment areas on the island are exceptionally sensitive, which leaves us little space in which to dispose of our household refuse. The problems that are being created by an endeavour to solve this difficulty with a waste-derived fuel plant currently appear to be compounding our financial difficulties rather than assisting them.
It will not have escaped my hon. Friend's eagle eye that the controlling group on the Isle of Wight county council is the Social and Liberal Democratic party. I am sure that my hon. Friend and his advisers would wish to know that I have made it crystal clear to the county council that I do not believe that it can simply be left to me to plead in Parliament the case for the Isle of Wight as a unique authority that deserves similar treatment to the only other island that is administered by the English Civil Service —the Scilly Isles—where a special factor called D2 is currently applied to its finances.
That same uniqueness, if I may use such a non-word, must bring a positive response from the county council to ensure that it considers every service, every function and every facility provided by county hall, and to ensure that, as England's Lilliputian county council, every facet of its work is justified and necessary.
My challenge to the county council will, I sincerely hope, reassure my hon. Friend that, in pleading on behalf of everyone on the Isle of Wight for some assistance under the proposed needs assessment area cost adjustments, there should be a special adjustment for our island in the community charge financial regulations.
On Monday of this week, a public meeting was held on the island organised by the Cowes governors support group, at which I and representatives of the county council answered question from a large audience about the island's finances. I made it quite clear that we must see a positive response from the county council to fine-tooth-comb all its functions. I believe that we received a positive response to that challenge at that meeting. I hope that in reply my hon. Friend will say that my submission—that the message that the island's largest local authority must provide a policy of value for money—has been received and understood, and I hope that it will be acted on.
However, that will still not provide us in any shape or form with the level of finances that we need to run our island services. Will my hon. Friend the Minister comment on the constitutional point, in endeavouring to reach a decision with his ministerial advisers, on the difficulty in which he and they find themselves in favouring one authority, particularly as it is generally accepted that, in the distribution of local authority finance, Ministers take


the advice of the Civil Service and the distribution of finance must be seen to have been applied fairly to all authorities.
I sincerely hope that my hon. Friend can reassure me that, because the precedent has already been established for the Scilly Isles, there will be no constitutional difficulty perceived by his permanent under-secretary or by his other ministerial advisers in ensuring that the island is once and for all legislated into the regulations—so to speak.
I appreciate that the effect of safety netting and the announcement made by my hon. Friend the Minister for Local Government and Inner Cities during the Conservative party conference last week will have some effect on the island and that it is possibly too early to give the House any precise information about how safety netting will assist us.
I want to draw the attention of my hon. Friend the Minister to the fact that, under the grant-related expenditure system, we are already the most heavily safety-netted authority in England. When the Association of County Councils put forward a recommendation to the Department of the Environment that safety netting should be abolished, my council and one other county council would have been very seriously hit if my right hon. Friend the Secretary of State had accepted its suggestion.
My hon. Friend the Minister is aware that the Isle of Wight is the largest water-metering test area in the United Kingdom, and that 53,000 meters are being fitted. There is absolutely no doubt that that will have an impact on households with young families. There is concern that the experimental tariff may have been set at a rather high level. My hon. Friend the Minister will be aware that the island has already received a ministerial assurance in this House that the tariff will be reviewed once the data are available.
The additional papers submitted to "An Island Apart" as a result of the visit of my hon. Friend the Minister for Local Government and Inner Cities to the island on 19 April, contain additional information requested by the Minister in support of "An Island Apart". They set out the impact on the island of the dislocation from the mainland and the additional costs of providing local authority services to the average island family. I particularly draw the attention of my hon. Friend the Minister to page 38 of "Regional Trends 23", the 1988 edition, which gives the average full-time male weekly wage on the island as £192·60, compared with £230·16 for the outer south-east.
The average income per head on the island is significantly lower than on the mainland due to the large proportion of pensioners in the island population. The Audit Commission report on urban deprivation gives us a Z score of plus 0·4 per cent. compared with the family average of minus 1·3 per cent. The 1989–90 Green Book shows that the figures for GRE for housing benefit for the two island boroughs averaged 21 per cent. more per head of the total population compared with all English shire districts. The major cause of the variation is attributable to rent allowances paid to private sector tenants. It can therefore be said that the average island family has a higher cost of living and a lower wage level than their mainland counterparts.
My hon. Friend will be aware that the figures were prepared before the last public sector wage awards of more than 8 per cent. for the National and Local Government Officers Association and more than 7 per cent. for the teaching professions, both of which are well above any increase in earnings in the private sector on the island.
I have just completed a tour of several factories and large employers, and in no case did I find any island employer increasing wage rates to anything like those levels. In practically all cases, they were involved in further cost-cutting exercises. Therefore, the island's community charge payers are placed in the nutcracker between nationally negotiated pay awards for public sector employees, the lack of economy of scale, and the particular difficulties, highlighted in "An Island Apart", of running England's smallest county council on the one hand and having a low wage economy with the additional costs of basis necessities as a result of our dislocation from the mainland on the other hand.
I hope that, having briefly set out to my hon. Friend the problems facing the island in the provision of basic and essential services, he will accept that the Isle of Wight has a case and that he will assure me that he and his advisers will give the island's case the most careful and detailed scrutiny before reaching a decision.

The Parliamentary Under-Secretary of State for the Environment (Mr. Christopher Chope): I thank my hon. Friend the Member for Isle of Wight (Mr. Field) for the kind words that he included in his speech. I have known my hon. Friend for some time—since before he became a Member of Parliament. I am obviously familiar with many of the problems of the Isle of Wight because of the proximity of my constituency.
I congratulate my hon. Friend on securing this debate and on the clear way in which he put forward the case for his constituents on the island. Having served as a county councillor on the island, he has a deep knowledge and understanding of the issues and is a persistent and energetic advocate on behalf of his constituents. He persuaded the Minister of Agriculture, Fisheries and Food, my right hon. Friend the member for Suffolk, Coastal (Mr. Gummer), to visit the island earlier this year. My hon. Friend has frequently visited my Department in Marsham street, and he is also a persistent letter writer. Whatever else can be said, it cannot be said that his constituents' case goes by default. My hon. Friend is very assiduous in his work.
The points that my hon. Friend has made this evening show a concern about the new grant arrangements which will come into place next April as part of the reform of local government finance. As my hon. Friend knows, the community charge will be a much fairer system than the system of domestic rates which it replaces. The community charge will have to meet only about one quarter of the total costs of local authorities. The Government will continue to provide substantial support for local government services through Exchequer grants, as now.
The Secretary of State for Trade and Industry, my right hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley), when he made his announcement in July, said that central Government support for local authorities in England for 1990–91 should be £23·1 billion, including the yield from business rates, which is 8·5 per cent. more than this year on a comparable basis. In addition, about £2 billion will be paid in rebates and income-related benefits to help poorer charge payers. We have also announced a scheme to help certain individuals who might otherwise lose significantly from the move to the community charge.
The new grant system is intended to be simpler and more straightforward than the existing arrangements. The key principle will be to ensure that if each local authority spends to provide a standard level of service the community charge can be set at the same level—the national norm—which will be about £275 for 1990–91. That is before taking account of the transitional arrangements. There will then be a clear accountability between each authority's spending levels and the level of the community charge. That accountability is at the heart of the reforms.
To achieve that general principle, the Government are working out for each authority what it should cost to provide a standard level of service, taking account of the particular characteristics of that area. Obviously the more pupils there are in an area, for example, the more it will cost to provide an education service to any given standard. Similarly, an area with a high population of elderly residents is likely to require a higher level of expenditure on social services than an otherwise similar authority. This assessment is known as the standard spending assessment. An SSA will be calculated for each local authority. It will reflect a range of factors, such as the population, the mileage of roads which have to be maintained, number of school pupils who have to be educated, and other factors which affect the amount which needs to be spent on local services.
To make such an assessment of the cost of providing a standard level of service for authorities up and down the country facing a tremendous variety of circumstances is, I readily accept, not an easy task. We are committed, however, to ensuring that these new standard spending asessments should be simpler and easier to understand than the existing arrangements.
We are also committed to producing assessments which treat every authority fairly and properly. To do this we need to devise a means of assessment which is based on applying the same calculation for each authority using information which has been assembled and verified on the same basis for all authorities in the country.
There are, of course, many ways in which these assessments can be approached. A great deal of work has been done over the past few years considering the various possible methods. This work has intensified since last December, during which time officials from my Department have been discussing with officials of the local authority associations detailed options for individual services. A large number of papers have been prepared, and a large number of meetings have been held. My right hon. Friend the Secretary of State and I discussed the results of this work with the leaders of the local authority associations at the end of last month in the consultative council. We have had many letters from hon. Members and local authorities, including letters from my hon. Friend. All these letters have put forward points of great concern to the individual authorities and they are all carefully considered, as will be the remarks of my hon. Friend.
We shall be reaching final decisions shortly, and making our proposals known when we consult the associations about the amount of grant for next year early in November. My hon. Friend has therefore got his timing

exactly right in initiating this debate tonight. The final proposals will be set out in a report to be debated in the House in January.
My hon. Friend has referred to the paper "An Island Apart" which he sent to the Department in February on behalf of the three local authorities on the island. It sets out the case for special treatment, reflecting the particular circumstances of the island.
As my hon. Friend has made clear, the Isle of Wight is the smallest of the shire counties—indeed, it is only about a third of the size of the next smallest in terms of population, which is Northumberland. It is also smaller than any of the London boroughs. In addition, the county is separated from mainland Britain by the Solent, which increases transport costs and makes it more difficult for the fire service, for example, to rely on mutual support from neighbouring authorities.
"An Island Apart" suggested that these two factors—the small size and the separation from mainland Britain —meant that the cost of providing local authority services to any given standard would be higher on the island than elsewhere. My hon. Friend developed that argument in detail, and gave particular examples. The report suggested that "insularity" forced the councils to spend a total of £4·6 million a year extra. He has therefore suggested that, in the methodology for calculating standard spending assessments, there should be a specific recognition of this factor.
My hon. Friend has suggested that proper account should be taken of the age profile of residents of the island. He is quite right. Standard spending assessments should and will take account of the proportion of the population which is elderly and the proportion of children in the area in assessing an authority's requirement for spending on social services. This will be so not just for the Isle of Wight, but for all authorities in the country.
My hon. Friend has also spelled out in some detail the range of incomes of people on the island. However, this is not a relevant factor to consider in relation to appropriate spending levels. The new community charge system is specifically moving away from any consideration of local resources whether they be measured by rateable values or by incomes. This is one of the ways in which our new proposals are seen to be fairer than the existing rating system. In terms of the provision of local authority services, many of which have a high labour content, low incomes would serve to reduce costs.
My hon. Friend has said that there is a problem with nationally negotiated wage deals, but it is possible for local authorities to take an independent line. It is also possible for local authorities to contract out more of their services and to invite more competitive tenders. If they invite competitive tenders, they should find that the tenders reflect more accurately local labour costs rather than national salary levels negotiated on a national basis by the national associations.

Mr. Barry Field: My hon. Friend will be aware that more than 60 per cent. of the county council's budget is spent on education. I understood that it was Government policy that education was to be centrally resourced and that it was of a national standard.

Mr. Chope: Certainly we want to maintain national standards of education, but that does not mean that the cost of running schools in every part of the country will be


identical. We know that many of the ancillary staff employed in the schools service have wage rates that differ substantially from one part of the country to another. That is an example of how, even within the education service, one should be able to get a better deal if one is operating in an area where wages are lower.
As my hon. Friend explained, there has always been special treatment for the Isles of Scilly, but that is a very extreme case. The population of the Isles of Scilly is less than 2,000, less than one fiftieth of the population of the Isle of Wight. It does not necessarily follow that the Isle of Wight and the Isles of Scilly should be treated in the same way.
"An Island Apart" was discussed at meetings between the Department and the associations as part of the general consideration of the area cost adjustment which is included in the standard spending assessment calculation. I have to say that representatives of the Association of County Councils and of the Association of District Councils were not convinced of the case for giving special treatment to the island. Their view was that the problems faced by the island were not significantly different from those faced by some other authorities.
Communications with the island, for example, are not necessarily more difficult than communications between, say, Cornwall or Cumbria and the rest of England. Some people in Cornwall say that Cornwall is an island because it is separated from the mainland by the river Tamar. Equally, the extent to which authorities can look to their neighbours for support varies across the country. Counties

with long coastlines or estuaries that split the county may face problems similar to those of the island, but, as I have said, we shall be considering all those arguments carefully before we reach our final decisions.
We shall certainly be reflecting in the standard spending assessments the fact that in some areas it costs more to provide services. We have in mind the fact that wage rates in London are higher than those elsewhere and that it necessarily costs London authorities more to recruit and retain staff. If we go for an area cost adjustment that includes all of the south-east, the Isle of Wight, notwithstanding its relative low-wage economy, will benefit from such a cost adjustment. The issue is whether we go further than that and decide that the position of the island is so different from that of other authorities—each of which believes that it circumstances deserve exceptional treatment—that a special factor is required.
To answer my hon. Friend's specific question, there is no constitutional bar to giving the Isle of Wight an area cost adjustment if it is justified on the merits. However, at present all these issues are being considered by the Department, and I hope that my hon. Friend will understand that I cannot say any more tonight about the specific points he has raised. As usual, he has put them forward persuasively, and I have listened to them carefully.

Question put and agreed to.

Adjourned accordingly at twenty-eight minutes past Ten o'clock.